Food Stocks That Will Weather the Drought

BOSTON (TheStreet) -- With the U.S. farm belt suffering its worst drought in 60 years, it's inevitable that food companies that rely on corn and grain are going to be hurt, resulting in slimmer profits and higher prices for meats, milk, bread and cereals for consumers.

But that shouldn't scare off investors as buying opportunities will crop up on dips in stocks of some food processers with the fiscal strength and management skills to ride out the drought.

Due to the drought, the yield per acre of corn may hit its lowest level since 1995, the U.S. Department of Agriculture projected last week.

And that projected low supply of corn, which is used in livestock and poultry feed, human food and drink, and processed for use in the gasoline additive ethanol, is moving up futures prices and the prices of end products.

For example, the Bureau of Labor Statistics said Wednesday that the average price of 100% ground beef hit a record high in July, at $3.085 per pound, while prior to June, the average cost had never topped $3.