Surging food prices will hurt poorest most

Drought conditions in parts of North America and Russia have caused soaring prices for corn, soybean and wheat, which is causing increased hardship for the poor, according to a Moncton soup kitchen.

New Brunswick food prices will jump next year, economist says

A corn field near Ashland, Nebraska, amidst the worst U.S. drought in decades. (Nati Harnik/Associated Pres)

Drought conditions in parts of North America and Russia have caused soaring prices for corn, soybean and wheat, which is causing increased hardship for the poor, according to a Moncton soup kitchen

Phyllis Perry, the supervisor of the Karing Kitchen, says she spent her latest trip to the grocery store filling a cart with hamburger, stew meat, and drink crystals.

Earlier that day, she fed 370 people at the Moncton soup kitchen. The high number of people being served at the soup kitchen is likely caused by the rising cost of food, she said.

"Gosh, just everything is sky-high," Perry said.

"When I remember those days, I used to come and get a package of hamburger, well, it wasn't all that much. But now, wow. It's very expensive."

Perry said she’s worried about stretching the soup kitchen's money even further now that food prices are rising.

The number of clients she feeds goes up — and food banks and kitchens struggle to get enough donations — while people are on vacation.

U.S. farmers are coping with the worst drought in a half a century, which has pushed corn prices to record highs.

The U.S. Department of Agriculture forecasts the average yield will be 123.4 bushels of corn per acre, down about 16 per cent from 2011. According to the U.S. drought monitor, about 85 per cent of the corn crop is now experiencing drought.

Sylvain Charlebois, the project lead of the University of Guelph's Food Retail Price Index, said earlier this week he expects food prices to rise by no more than 4.5 per cent in 2013. But he said only a small amount of that can be attributable to the drought.

Food prices are rising

David Murrell, an economist at the University of New Brunswick, said prices likely won't rise in New Brunswick until winter, at the earliest. 

But once they do, it will hit the poorest citizens the hardest, he said.

"It's difficult to cut back on food expenses. They may cut back by buying less quality food; more filling, less nutritious food, for example," Murrell said.

Food prices this year are already higher than forecast, said Murrell.

He believes the rising food prices will also hit people who normally do not rely on assistance.

"Some of the low-income people I would say are people on minimum wage that don't normally receive money from charity, just the lower end of the income side," he said. "They will feel the bite the hardest.

"It affects all of us, but the lower-income people in New Brunswick … also the charities that are generally assisting the very low-income people; the people in distress" will feel it the most.