Strengthening AUD may impact wheat and beef farmers, academic says

The strengthening Australian dollar may pose significant challenges for wheat and beef exporters in rural and regional areas.

The impact of this on Australian farmers is likely to be one of the many economic concerns in the minds of attendees at the Regional Business Leaders’ Forum in Toowoomba later this month (April).

USQ Dean of Business and Economics Professor, Allan Layton, said two major forces were responsible for strengthening the Australian dollar.

'Our domestic interest rates represent a relatively high rate of return to foreign investors, and the recovering world economy has put considerable upward pressure on the prices of commodities, especially energy prices and the prices of commodities used in steel making,' Professor Layton said.

'Those Australian companies exporting commodities experiencing the higher prices are to an extent shielded from the higher Australian dollar. But its strengthening is posing significant challenges for other Australian exporters of products whose international prices have not as yet experienced significant increases.

With the higher exchange rate this means such exporters, such as wheat and beef producers, are receiving fewer Australian dollars from their sales, thus squeezing their profits.

'On the upside, some inputs, such as imported chemicals and machinery will be relatively cheaper.'

More than 400 local business people, politicians, media representatives and University of Southern Queensland (USQ) academics will gather for the upcoming Regional Business Leaders Forum at Picnic Point on April 23.

The Forum stems from a Memorandum of Understanding (MOU) signed between USQ and the Toowoomba Chamber of Commerce and Industry in 2009. Both USQ and the Chamber are fully committed to providing world-class professional development opportunities in the region where important relevant current business issues are to be addressed.