As the strength of the U.S. dollar continues to weigh on agricultural exports, the U.S. Meat Export Federation (USMEF) focused on the impact of the U.S. dollar strength during a panel discussion at last week’s USMEF Board of Directors Meeting in St. Louis.

Michael Drury, chief economist for McVean Trading, provided a brief history on how the currencies of so many trading partners and competitors became so weak relative to the U.S. dollar. He said a key factor was the economic slowdown in China, which generated a significant reaction to devalue currency from many commodities-producing countries except for the United States.

“Devaluation means you’re selling your labor, and everyone in your country’s labor cheaper, and you’re offering for sale all of the assets in your country cheaper. It is a very stupid policy to devalue your currency, but a very good political policy in the short run,” said Drury.

USMEF Economist Erin Borror also served on the panel, noting that the exchange rate situation seemed to be improving in 2016, but that the U.S. dollar has recently gained renewed strength versus several key currencies.

More information from the USMEF Board of Directors Meeting is available online.

Listen to audio from the meeting here
USMEF Report on Currency Situation