Christine Reid, owner and chef at Locavore restaurant in Southeast Boises Bown Crossing development, expects some of her from-scratch recipes will be revised soon.
Reid has built a reputation for buying local and producing gluten-free dishes including bread, pastries and waffle batter. But that often means using corn, which does not contain gluten, as a substitute for wheat, which does.
Corn prices, however, have skyrocketed to as much as $8 a bushel compared to about $2 a few years ago as drought scorched much of this years crop in the Midwest.
We are going to have to look for something else, like rice or garbanzo flours, Reid said.
If she cant find it, some menu items may go on holiday until the price of corn eases. Thats because keeping a sharp eye on food costs is vital to a restaurants success, said Reid, who has spent 20 years in the business.
Whats worse, all of this could hit in the next few months likely over the holidays, when people do lots of entertaining, she said.
Rising corn prices affect dairies, feedlots and grocery stores, along with restaurants.
Your Thanksgiving turkey is probably going to cost more, because poultry prices are among the first to reflect rising cost, according to the U.S. Department of Agriculture.
Corn is part of the feed for poultry. Paul Patterson, a University of Idaho economist, expects poultry suppliers to cut back on production as the price goes up, which will limit supply and raise prices.
Within a year, processed foods with ingredients such as corn syrup, like soft drinks, will increase. The USDA expects food prices will climb as much as 4.5 percent in some categories in 2013, partly because of rising corn prices.
Idaho ranchers and dairy operations are already paying more.
John Hepton, a Nampa resident who owns feedlots in Oregon, Melba and Twin Falls that range from 6,000 to 30,000 cattle, said rising prices have pushed his operations to the break-even point or slightly below. Corn is an essential ingredient in feeding cattle to get them ready for market.
Feed corn has shot to $300 a ton from $200, he said. It really puts a real strain on our industry, Hepton said.
The market price for cattle is about $1.20 a pound, said Wayne Prescott, executive vice president of the Idaho Cattle Association. But Prescott said it is costing feed lots about $1.30 a pound to fatten them up.
Hepton said he needs to get about $1.25 a pound now to break even. If corn prices keep going up, he will need $1.32 to break even or move ahead. He employs 65 people in his operations, and if hes squeezed too hard, he may have to let some go, Hepton said.
For dairy farmers, the problem is worse. Dairy farmers were already weakened by a bad year in 2009 and were barely able to recoup operational costs but not fixed costs in 2010. They fared slightly better in 2011, Now they face a bad year in 2012 because of corn prices.
Some dairy farms cant get bank approval to buy feed on contract, which is usually cheaper than buying on the open market. So they are getting hammered making open-market corn purchases, said Bob Naerebout, Idaho Dairy Association executive director.
As a result, some dairies cant afford the optimum feed for their herds, resulting in lowered milk production, often with less butterfat and protein. That can result in lower prices at market and fewer gallons of milk going into the food supply, the association says.
Idaho produces about 36 million pounds of milk each day. Most of it goes to food products, not liquid milk. Production was down half a percent in July and could be down again when Augusts numbers are tallied.
Idaho isnt a big player when it comes to growing corn. Idaho farmers plant about 380,000 acres much of it for silage, which is cut-up corn plants fed to cattle compared with millions of acres in Midwest states. And many Idaho corn growers put their crop under contract before the drought hit full force and pushed up prices.
But unlike the Midwest, where fields are seldom irrigated, water released from reservoirs such as Lucky Peak and Arrowrock have kept the corn crop at places like Derek Vermeers farm southwest of Greenleaf well bathed through 2012s hot summer.
Vermeer signed contracts to sell shelled feed corn to two local dairies for a good price: about $180 a ton. But in these drought-stricken days, the going price is about $290 a ton, he said.
High corn prices, however, are no guarantee that Idaho farmers will plant more corn next season. While the trend has been toward increasing acreage, that is driven by dairies, who are corn producers primary customers. Patterson said that if dairy herds expand, corn planting may grow, too.
Bill Roberts: 377-6408, Twitter: @IDS_BillRoberts