Drought is putting strain on food, water, energy, and the places where they intersect. (Photo by Shutterstock.)

What a difference a year makes. Last spring, farmers along the Mississippi River watched in horror as the Army Corps of Engineers blew up levees to let floodwaters run into their fields in order to protect downriver cities (check out this NASA video of before and after LANDSAT photos). This year, farmers around the country are watching helplessly as drought causes widespread crop damage. In some places along the Mississippi River, water levels are 50 feet below last year’s near record high levels. Unfortunately for a country already struggling with a slow economy, damage caused by this drought is going to be expensive and could affect many parts of our lives. Our food, water, and energy systems are so intertwined that a crisis affecting any one of those resources can throw the others seriously out of balance.

As of June 2012, more than half of the country was in various stages of drought (according to information from the weekly U.S. Drought Monitor Report) and more than one-third of the nation’s counties had been declared federal disaster areasIn July, we didn’t get much relief, so that number is rising. Food, water, and energy come together to form an important nexus. We’re experiencing that nexus firsthand, because the worst drought since 1956 will likely produce significant impacts on food and fuel prices, and could cause urban water supplies in some regions of the country to dry up — with staggering consequences.

Here’s how food, water, and energy are being impacted by the 2012 drought, and some tips to help you minimize the impacts of these higher prices on your budget.

Photo by Shutterstock.

The obvious impact is damage to crops, especially to corn and soy. With no rain falling, crops are failing in places where crops are not irrigated or where irrigation water is in short supply. Corn is especially problematic because it’s in practically everything we eat (we even put it into our gas tanks). Check out the labels on those boxed, canned, and bottled products you might be buying at the grocery store. The chances are they’re made with corn or soy. Also, if you eat beef, poultry, pork, or even farmed fish, those animals were probably given feed made up of corn or soy. Dairy products and eggs? Same thing. Prices will likely be rising on meat and dairy products over the next few months, and certainly by next year. Processed foods and cereals are less likely to see the massive price spikes because those foods are generally cheaper to produce (at least they seem cheaper on the surface) but are generally much less nutritious than whole foods.

This would be a good time to:

  • Consider using meat and dairy products as accents rather than the main ingredients in your diet. Try changing to a diet based on fresh and whole (meaning less processed) foods like fruits and vegetables, the price of which aren’t expected to be as significantly impacted by the drought because they are generally irrigated and the water is highly regulated.

Diminishing corn supplies could also affect gasoline prices. There are mandates in place for the amount of ethanol that has to be included in gasoline, and American ethanol is made primarily from — you guessed it — corn. In fact, 40 percent of last year’s corn crop went toward making ethanol. In this time of limited corn supplies, livestock producers aren’t happy with the mandates or with having to compete for corn for their feed. The EPA could decide to lower the amount of ethanol required in gasoline, but that probably won’t happen until next year.