While inflation may be moderating, higher temperatures are causing fruit and vegetable prices to rise.
Transcript:
Conway Gittens: Here’s what we’re watching on TheStreet today.
Wall Street is keeping one eye on the Federal Reserve this Tuesday as policymakers begin two days of deliberation on the path of interest rates. The other eye will be on earnings. Some 44 companies in the S&P 500 are set report quarterly results including Microsoft, Starbucks, PayPal and Merck.
In other news: Record temperatures are likely to lead to a long-term spike in food prices. Farmers are struggling with crops as searing heat and water shortages impact how much food is being grown. Most produce prices are locked in for the summer, but prices are likely to rise due to decreased supply.
Organic farmers in California and Oregon have seen fruits like blueberries and citrus shrivel under temperatures that have topped 100 degrees.
Meanwhile, as the heartland bakes, corn production has declined. Corn growers are losing “$720 million in revenue annually due to heat’s effect on crop yields, which will increase to a projected $1.7 billion annually by 2030,” a 2021 study published by the Atlantic Council projected. Researchers and experts say that will force farmers to raise prices in order to stay in business.
And that will have a knock-on effect throughout the food chain. Farmers use grains and vegetables as feed for livestock like chicken and cows, so as warmer temperatures push input costs higher, meat producers will be forced to pass that on to consumers, ultimately leading to higher meat prices at the grocery store and at the restaurant.
That’ll do it for your Daily Briefing. From the New York Stock Exchange, I”m Conway Gittens with TheStreet.
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