THE sky was blue, the sun was out. Was that a topless woman I just spotted on the shore of Lake Michigan? Outwardly there was little sign of the severity of the storms that have swept across the middle of America when I arrived in Chicago last week. But turn on the television or open the paper and all you see are pigs on roofs trying to escape the flood, homes under water and crops destroyed. The rain may have stopped, but the consequences are only just starting to be felt.

Not so long ago, corn prices were boring, a topic for farmers to chat about over their fences. The rise and fall of crop prices might have excited a few traders in Chicago, but the rest of us couldn’t have cared less.

And why on earth should we have cared? There was loads of the stuff out there. Bushels of it. Practically growing out of the ground.

How things have changed. Now crop prices are a hot topic in Washington, on Wall Street and on Main Street. Food is top of the political agenda as the price of rice, corn and other cereals has hit record levels. Meat, by many accounts, is next.

Using corn for ethanol production led to a spike in prices long before the floods took their toll. According to some reports, the meat industry is already selling off breeding animals in order to offset losses from the high price of corn and soybeans it needs to feed its livestock.

The move will temporarily increase the meat supply, but it also means that supplies of some meats will begin to shrink later this year and prices will rise.

Tyson Foods, the giant Arkansas-based meat producer, has predicted that retail chicken prices will have to jump by double-digit percentages in 2009 for poultry processors to recoup their feeding costs. The cost of food is increasing at its fastest pace in 18 years.

The price of corn has more than tripled in the past two years to record high levels. Analysts estimate that flooded Iowa and Illinois and the other corn states might produce 15% less grain than last year. Some believe the shortfall will be even larger. The commodity traders in Chicago certainly think so and are bidding up the price of corn in the expectation of shortages.

Although the corn-growing season is young, the flooding is already prompting some grain industry analysts to trim their harvest forecasts. The Department of Agriculture has estimated the US will use 12.5 billion bushels this year. About 5 billion would be used for feed, 4 billion consumed by ethanol production, 2 billion sold overseas and the rest put to other food, seed and industrial uses.

America was on schedule to produce 11.7 billion bushels and the shortfall would be made up by corn grown in previous years, but the floods threaten to drain those supplies.

Nor can America expect much help from Australia, the second-biggest exporter of corn.

On the other side of the world, Australia is experiencing the opposite problem to the Americans. The Australian authorities recently had to cut the wheat output forecast by nearly 9% after the return of dry weather during the crucial planting period dashed hopes for a return to record crops.

It’s all looking very biblical. Given that the Bible belt crosses the corn belt in middle America, it’s a surprise someone isn’t making apocalyptic noises about seven years of famine and flood. All we need now is a plague of locusts.

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