U.S. Agriculture Secretary Tom Vilsack says the drought isn't contributing to higher food prices—at least not yet.
Vilsack spoke Friday in Omaha following meetings with ag producers and ethanol industry representatives. Last week's drought report shows 90 percent of Nebraska and 60 percent of Iowa are seeing extreme drought conditions.
Vilsack, the former Iowa Governor, says prices might actually drop short-term as producers sell livestock due to the drought. "We can anticipate food inflation to be somewhere between 3 percent and 4 percent next year. Traditionally and historically, it's about 3 percent a year. So we're not looking at that significant of an increase, and of that, the drought might be responsible for half a percent to a percent."
Last Friday, the USDA cut its corn yield forecast by 17 percent. Vilsack says even with that, this year's corn crop is expected to be the eighth largest on record.