Prices for two key crops set new records on Friday as the heat and dryness across many of the Canadian and American agricultural regions is starting to kindle fears of a food crisis.

Most of Central and Eastern Canada and the U.S. Midwest is experiencing extreme heat and little rain, causing drought conditions.

"It's like a double whammy," Environment Canada senior climatologist David Phillips told CBC News earlier this week. "There's no rain and all that heat demands evaporation …It's almost as if the atmosphere has forgotten how to rain."

So far this summer there have been record-setting high temperatures across Ontario, Quebec and the Atlantic provinces coupled with some of the lowest rainfall on record.

South of the border, temperatures above 40 degrees C and drought-like conditions in such states as Iowa and Wisconsin have baked parts of the upper Midwest for weeks, taking a severe toll on corn and soybeans.

Corn futures traded at an all-time high Friday at more than $8.16 US a bushel on the Chicago Board of Trade, while soybeans hit $17.77 a bushel, also a record, before retreating slightly.

It's the second summer in a row of price spikes for the two commodities. Last summer's heat wave in the U.S. Midwest drove up corn prices 25 per cent.

But while many areas are suffering under the harsh growing conditions, farmers in the Canadian Prairies are hoping for a boon. There's been plenty of moisture in Alberta and enough in Manitoba and Saskatchewan to keep crops in good condition. That means those farmers could see windfall revenues come harvest time, as they supply healthy volumes of the staples into a high-price market.

Cattle farmers suffer, too

Livestock growers have it bad, however, as their cost for cattle feed skyrockets. And since corn and its byproducts like high-fructose corn syrup and fuel ethanol are used in a great variety of foods and goods, the effects of the grain's record price could be widespread.

For now, though, the staples' higher prices won't affect what consumers pay at the grocery store, a pair of economists said.

"In the past we've found the lag could be as long as nine months, so this could become a big issue around the turn of the year," said Doug Porter, deputy chief economist with BMO Capital Markets.

TD Bank economist Dina Ignjatovic, in a note about Friday's Canadian inflation data, said the lag between commodity and grocery prices can stretch to 12 months.

The near-drought is raising concerns about food security in developing countries. The U.S. and Canada are the world's No. 2 and 5 soybean exporters, respectively, and Nos. 1 and 3 for wheat — whose price has been drive up by the surge in corn and soy.

The last time grain prices spiked nearly this steeply, in 2008, there were food riots in 30-plus countries, both in the developing and developed world. 

Precipitation map
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