Implications for the agri-food industry due to a sustained high dollar

Summary

Australian farm exports earned the country $32.1 billion in 2008/09. This represented 11.9% of total commodity exports and 14.7% of all Australian merchandise exports (ABARE, 2010). Exports are highly sensitive to currency fluctuations and given the Australian dollar looks likely to remain in the order of at least parity to the US dollar the implications for producers, exporters and the broader agrifood* industry could be significant. This project seeks to understand what these implications are, inputing into policy and decision making by governments and industry organisations. The project will consist of four phases. 1) Undertake a desktop analysis to better understand when else in history the Australian dollar has impacted on the competitiveness of Australian agrifood exports, as well as how other countries have addressed this issue. 2) Conduct a series of interviews with importers in key agrifood export markets as well as Australian exporters. The aim of these interviews are to identify how markets are responding to a high Australian dollar, and what strategies export companies are implementing in order to stay competitive despite a high dollar. 3) Based on these interviews the project will undertake a scenario planning phase with relevant academics, industry representatives and government officials so as to identify and understand what the likely implications of a sustained high dollar might be. 4) Extension of these findings will be the final phase of the project and will be important to ensure the objectives and outcome sought from this investment if achieved. *the term agrifood in used to describe commodities and food products that are minimally transformed.

Program

National Rural Issues

Research Organisation

OLD ABN-The Department of Primary Industries on behalf of the State of Victoria

Objective Summary

The primary objective of this project is to influence government policy and industry strategies through an enhanced understanding of the implications of a sustained high Australian dollar and other major currencies, particularly the US dollar. The focus of this analysis is to understand the micro or firm level impacts of a protracted high Australian dollar. The focus is not on understanding the macro impacts and the global repercussions which is another project in itself. Subobjectives include: 1. Raise awareness of the implications of a sustained high Australian dollar to the food industry by providing case studies. 2. Provide a summary of possible company strategies developed in response to the scenarios. How companies are dealing with the high AUD.

Project Code

PRJ-007898

Project Stage

Closed

Project Start Date

Wednesday, February 1, 2012

Project Completion Date

Friday, March 1, 2013

Journal Articles From Project

Not Available

National Priority

Frontier technologies for building and transforming Australian industries

National Priority

Advanced Technology

National Priority

NRI-National Rural Issues

Contact

Related publications

24.07.14

The high Australian dollar and agrifood export