The value of the United States dollar has been trending upward overseas and all of the agriculture sectors see a direct result from that with lower exports and dropping prices.
Dollar Up Means Ag Exports Down
Bank of America national executive for food, agriculture and wine Cornelius Gallagher showed dairymen and women that the U.S. dollar’s world value is continuing to increase. He says this is just another reason why some industry prices are continuing to slip. “The double-whammy is that the valuation of currencies like Australia and New Zealand, who are closer to the Asian markets anyhow, is relatively down,” Gallagher said. “So in a global system where people go for the lowest net cost in their currency, they’re gonna go to those places with the lowest net costs.”
Although Gallagher was talking about the value of the U.S. dollar at a dairy conference, he reminded everyone that this market trend can be seen across agriculture. “This by the way doesn’t just impact dairy,” Gallagher said. “A lot of things that California produces are impacted by the value of the dollar and it can be translated to the U.S. agriculture economy.”