A "worst-in-a-generation" drought across half the United States could drive food prices to record levels as crops across half the country are ravaged, according to Bloomberg Businessweek.
"It might be a $50 billion event for the economy as it blends into everything over the next four quarters," Michael Swanson, agricultural economist at Wells Fargo & Co. in Minneapolis, the biggest commercial agriculture lender, told Bloomberg. "Instead of retreating from record highs, food prices will advance."
The U.S. Department of Agriculture declared July 11 that more than 1,000 counties in 26 states are natural-disaster areas - the biggest such declaration ever.
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As much as 20 percent of the U.S. corn crop could be lost because of the worst drought in decades, experts say.
"Topsoil has dried out and crops, pastures and rangeland have deteriorated at a rate rarely seen in the last 18 years," the National Oceanic and Atmospheric Administration said in a report Monday.