Midwest Drought Worsens: Food Prices Forecast to Rise

As a small businessman with a family of 5, the last thing Doral's Giovanni D'Angelo wants to hear about is higher food prices.

The Home Inspector says "It's rough, we're a family of 5 and already as it is we're paying $150-$200 a week on groceries...hopefuilly not man!"

But  according to the latest federal food forecasts, the midwest drought will raise food prices about 5% next year.

One of the biggest crops hit?

Corn.

Illiinois farmer Bob Bleurer tells CBS News "they're going to go up, they're going to go up big time....this country lives on corn.

And that's expected to drive up the price of almost everything.

Beef prices are forecast to rise possibly as much as 5% next year, with cereal, dairy and eggs up about 4%.

Southwestern cattlemen are already selling off their cattle.

For the short term..beef prices could actually drop acording to Scott Shellady who adds " Cattle will go to slaughter because they can't afford to feed 'em, so you'll have meat prices actually go down in the short term, but in the long term -- when there's no cattle left -- you'll see meat prices climb."

For now, prices around South Florida remain stable.

Florida is a big cattle and produce grower.

State Ag offcials say local price hikes may be less here than other parts of the country.

But for shoppers like Giovanni, the news out of the midwest means he may have to  start planning right now to start cutting back spending somewhere else.

He says " I'm going to cut back in other areas..you have to eat..we'll have to manage however we can".

Making the possible pinch of rising food prices even worse for families all over South Florida?

Gas prices are rising too as wholesoil prices recebntly started climbing.

But salaries and take home pay remain stalled. So stretching food budgets next year may get even tighter than it is now.

For more information:

USDA Food Price Forecast:
http://www.ers.usda.gov/data-products/food-price-outlook.aspx