The US is becoming so dependent on corn that a drought would have catastrophic effects that would ripple throughout the economy, reports the LA Times. Corn is essential as staple livestock feed, artificial sweetener, and a basic component of ethanol. A "corn shock" could lead to $5 gas and $3.50 eggs, economists warn. "We are replacing price volatility from the Middle East with Midwestern weather price volatility," said one analyst.
A drought could "raise prices so much in so many places that it could tip the US into a recession," said another observer. The demand for corn, which has driven up prices 20% this year, is also pushing up the cost of other crops. As US farmers switch fields to corn to reap the profits, the supply of other crops dwindles. Wheat prices are up 21% and soy prices 25% this year.