Low Canadian dollar advantage overrated: Jubinville

Canadian grain farmers are getting higher prices than their U.S. counterparts, 
but according to one analyst the best prices follow a strong dollar

The low Canadian dollar relative to the American is seen as a competitive advantage for Canadian grain exporters since grain exports are priced in American dollars.

But ProFarmer Canada president Mike Jubinville says the advantage needs to be put into perspective.

“While the drop in Canada’s dollar makes Canadian grain more competitive, it’s a short-term variable,” he said. “Ultimately I don’t think currency has a great deal of impact on making Canada that much more competitive. But when it changes so fast over a short period of time it takes industry time to adjust to it. When the Canadian dollar is low relative to the U.S. dollar, typically that’s because Canada is ‘commodity’ type country. If the Canadian dollar is down it means commodity prices are down.

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Farmer in wheat field

“The best prices we’ve ever seen on canola ($14 a bushel) was when our dollar was at par or better relative to the U.S. dollar. And the very worst canola prices ($6) we’ve ever seen have been when we were at a 65-cent dollar.

“When the Canadian dollar is strong it is usually when commodity prices are strong and we’re selling at prices that are the most profitable,” Jubinville said. “And that’s the oddity that never gets talked about.”

About the author

Reporter

Allan Dawson

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.

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