Depending on several factors, the dollar could remain strong entering 2016, says Julianne Johnston, digital managing editor of Pro Farmer.
“What we like to see with large crops is a period of building demand and that is what the impact of the dollar has been,” Johnston tells “AgDay” host Clinton Griffiths in a segment filmed during the 2015 Executive Women in Agriculture conference this month. “We have built domestic demand for corn and soybeans and domestic demand for livestock is also improving per capita use. But the dollar, if it doesn’t see some of the air come out of it, will be a big story again in 2016.”
The strong dollar has pressured corn and soybean markets, limited exports of crops as well as livestock, Johnston says. The dollar’s value also has risen amid expectations the Federal Reserve will raise interest rates this month.
“If you don’t raise rates, I think we’ll see some of that air come out of the dollar,” she says. “But if they raise rates, there could be a sell-the-fact reaction or … kind of a ‘what’s going to happen?’ because the dollar is so elevated.”
Click the play button below to watch the complete interview with Johnston on “AgDay”.