Strong American dollar could affect Illinois farmers
Although a strong dollar can be economically good for the country at large, it can be hard on central and southern Illinois.
In 2016, the U.S. dollar had a higher value relative to other currencies than it had in more than a decade. While a stronger dollar means individuals get more for their money on the next vacation abroad, it also means other countries can’t afford to buy as much of what we sell them.
“It takes more of their currency to buy what we’re trying to sell,” Iowa State economics professor Dave Swenson said.
According to Swenson, this will, in turn, hurt the Midwestern farmer looking to sell grain and livestock by depressing market prices.
“You’re going to end up with supply that you’re unable to move,” he said.
Swenson believes lower demand for agricultural products means less money in a farmer’s pocket to spend, which will slow down local economies in central and southern Illinois, which depend on that activity.
“There’s a multiplier effect on basic farm spending plus all of those other industries that are affected by it,” he said. “That’s what affects your ‘Main Street’ in that there’s less household income getting made from the farm sector.”
Illinois Department of Agriculture numbers indicate that the state’s grain markets export more than $8 billion to other countries every year. Approximately 44 percent of the grain produced in Illinois is sold for export.
–Illinois News Network