Strong dollar hits locals
THE Australian dollar hit its highest level since 1983 when it topped $US1.05 last week.
While this is good news for consumers – cheaper flat-screen TVs and less expensive petrol – it also has the potential to undermine local businesses dependent on overseas markets.
“The rising Australian dollar has the ability to put a dent in everybody's bottom line,” said Gary Burridge, chief executive of the Casino-based Meat Company that exports local beef to America and Japan.
“The high dollar makes it difficult for us to market our product and gives our US, Brazilian and Argentinean competitors a significant advantage.”
Mr Burridge would like to see the Australian dollar closer to $US0.80, but doesn't think it will be there for “a long time yet”.
The only thing protecting the hip pocket of local beef producers is a lack of livestock supplies that is helping to support overall prices, said Mr Burridge.
Luke Short, of LSD Surfboards, said the rising Australian dollar had forced him to reorganise his overseas expansion plans.
Originally he wanted to make boards here and send them to America, but the cost of freight and the rise in the currency thwarted this plan.
“It is now just too expensive to ship boards,” he said.
Instead he has joined an alliance of Australian board designers who have set up a shared-manufacturing facility in California.
“It is super competitive in the United States, but it is better than nothing,” he said.
The rising dollar makes some foreign inputs for surfboard making cheaper, but it also makes foreign-made boards cheaper.