Exporters sit tight as dollar soars
THE rampant Aussie dollar, which broke through the 95 US cent barrier this week, is not yet causing sleepless nights for Bundaberg exporters.
While a high Australian dollar would make Australia's exports more expensive overseas, exporters say the upside is in some necessary imported products being cheaper and balancing out the increase.
Austchilli managing director David De Paoli said he thought the high Aussie dollar would affect the company's trading overseas, but it had not been much of a problem so far.
“We thought it was going to affect us, but it hasn't so far - we've been dealing with these guys for a long time,” he said.
Mr De Paoli said it was possible to put contracts in place to flatten out the variations in the currency.
“We used to do that years ago, but the best way for us now is to go with the flow,” he said.
He said the company's main markets were in Asia, Europe and the Middle East.
Mr De Paoli said while the company expected to lose a bit on sales because of the strength of the dollar, some imports should also be cheaper.
“The price of fertilisers and machinery should go down,” he said.
Bundaberg Canegrowers chairman Alan Dingle also said the strong Aussie dollar should not have much effect on the price of Australian sugar overseas.
“Most of this year's crop has already been sold,” he said.
“But anyone who exports will have some issues with the high Aussie dollar.”
But Mr Dingle agreed items such as fertiliser and fuel should come down in price.
At noon yesterday the Australian dollar was flat, but still trading close to a 26-month high as investors waited for news on moves by the US Federal Reserve.
The Australian dollar was at 95.63 US cents, down fractionally from Wednesday's local close of 95.64 cents.
Since 7am yesterday the currency traded between 95.27 cents and 95.71 cents.
The local currency pushed up to 96 US cents during offshore trade, its highest since it touched 97.92 US cents on July 25, 2008.