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Adventures With Danno, 5/4/26
"Massive Price Increases At Walmart!"
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Finance Hour, 5/4/26
"People Don't Realize What's About to
Hit Grocery Stores This Summer"
"People don't realize what's about to hit grocery stores this summer. In mid-March 2026 the United States fertilizer supply was at 75 percent of normal levels at the exact moment Corn Belt farmers were preparing their soil for planting. The Strait of Hormuz, which carries approximately one-third of all internationally traded fertilizer, has been effectively closed since February 28th when Iran shut it in retaliation for U.S.-Israeli airstrikes. Some fertilizers rose more than 40 percent in just one month after the war began according to research by Florida International University professor Aya Chacar published in The Conversation. Cereal plants absorb the vast majority of their nitrogen needs during early growth. Reducing nitrogen application by 10 to 15 percent or delaying application by two to four weeks can reduce corn yields by 10 to 25 percent. Farmers who fear not being able to optimize their yields are deciding right now to plant less corn or switch to soybeans which need less fertilizer. Either choice reduces the corn supply.
Corn is not just a vegetable. Corn is animal feed, high-fructose corn syrup in thousands of processed foods, ethanol blended into gasoline, and the raw material for plastics and packaging. The USDA projected a 3.1 percent average increase in all food prices for 2026 using data collected before the war began. That forecast is already obsolete. The U.S. beef cattle inventory has shrunk to its lowest level since 1962 after a combination of persistent drought and high costs in 2022 forced producers to kill 13.3 percent of the national beef cow herd, the highest proportion ever recorded. Farm-level cattle prices were 26.5 percent higher in August 2025 than the previous year. Beef and veal prices were 15 percent higher in January 2026 than January 2025. Avian influenza has resulted in the culling of more than 185 million birds since 2022, the largest animal disease event in American history. Egg prices hit an all-time average high of $6.23 per dozen before declining and the flock remains one outbreak away from another price explosion.
Cornell University professor Christopher Barrett told Newsweek that labor accounts for half the cost of food in your grocery cart and that the food system is especially dependent on foreign-born workers. Current immigration policy and deportation tactics are creating labor shortages that drive up food system workforce costs. University of Minnesota economist Kjetil Storesletten told CNBC that the price of food is going to move quite a lot and that the increased fertilizer price will be passed through to food entirely because farmers, processors, and retailers operate in low-margin industries.
The ABA/Farmer Mac Agricultural Lender Survey projects that only 52 percent of U.S. farm borrowers will be profitable this year. The Federal Bank of Chicago reported estimated crop losses of $10 billion for soybeans, $20 billion for corn, and $8.5 billion for wheat. Farm bankruptcies are soaring. Farm debt is set to hit a record high. The Farm Bill has not been reauthorized and is operating on its third extension of the 2018 law. The government shutdown froze financial assistance to farmers during critical crop-planning season. SNAP benefits face a $295 billion cut over the next decade, a 36 percent reduction, the largest in the program's 90-year history. Work requirements are expanding to ages 55 to 64. Benefits will be cut approximately $100 per month for 600,000 low-income households. Fourteen percent of U.S. households reported food insecurity between January and October 2025 according to Purdue University, up from 12.5 percent in 2024. In New York City 40 percent of families cannot afford weekly food costs according to Robin Hood and Columbia University. One in three Americans skipped a meal in the past year according to the Century Foundation. The U.N. World Food Program predicts an additional 45 million people worldwide could face hunger by end of 2026.
The International Fresh Produce Association warned that produce cannot be stockpiled and that as energy prices rise they drive higher consumer prices while natural gas becoming a premium commodity raises costs for plastic food packaging. American grocery stores operate on a 72-hour inventory cycle. Three days of food on the shelves at any given time. Seven simultaneous crises are converging on the American food system this summer: the fertilizer disruption from Hormuz, the cattle herd at a 64-year low, the avian flu fragility, the farm labor deportation, the farm financial crisis, the SNAP cuts, and summer heat stress on crops livestock and cold storage infrastructure. Not one of them has a solution that arrives before your grocery bill does."
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