The worst U.S. drought in more than half a century has pushed the prices of soybeans and corn to record highs. Although the American economy has been largely free of inflation, the costs of these two crops could change that in certain sectors. Reuters reports:

Chicago Board Of Trade August soybeans rose 1.56 percent to $17.10-3/4 a bushel, a record high for the contract, while November soybeans, the most actively traded contract, rose 1.34 percent to $16.41-3/4 a bushel.

Spot corn rose 1.19 percent to $8.04-1/2 a bushel, surpassing the previous high of $7.99-3/4 a bushel set back in July, 2011.

The effect will ripple from corn to ethanol and cattle prices as energy and feed costs increase. Soybeans also are used for feed and a number of consumer products.

Douglas A. McIntyre