So far, drought in the Midwest has not greatly affected price inflation for the restaurants, he said in a Bloomberg Radio interview -- even though he says it’s led to a “parabolic” move higher in corn and soybean prices in the futures market since June.
“These parabolic moves just can’t last forever,” Rothbort said. “We’ve seen this before with crude oil prices when there was a perceived shortage. … There will be rain showers that hit the U.S. And everyone who was betting on prices going up double from triple from here, they’re going to have to get out of positions pretty fast.”
Once this drought does end, farmers will be back on the market to buy back seed. He says that there will eventually be a market for drought-resistant seeds. He noted that Monsanto (MON) received USDA approval for a drought-resistant corn seed in December.
Separately, Rothbort was quoted in the Christian Science Monitor, regarding the drought’s potential impact on U.S. consumers.
You can listed to his Bloomberg interview here.
Also check out the Christian Science Monitor’s coverage here.