The Great Drought of 2012: Impacts on Agriculture & Energy

The excessive heat and drought across the central U.S. in the summer of 2012 resulted in the worst corn and soybean crop, basis trend yields, since the infamous 1988 Midwest drought. The impacts of the drought caused a dramatic increase in the prices of major agricultural products, raising the potential sustainability and viability of the ethanol industry in the U.S., which consumes nearly 40% of the U.S. corn crop. The elimination or reduction of ethanol as a main fuel source for transportation in the U.S. could have dramatic impacts on both agriculture and energy prices (gasoline, natural gas, oil). This talk will review the impact of the summer of 2012 on both the agriculture and energy industries.