Investing.com - The strong dollar is "impeding" U.S. exports of wheat, corn, and soybeans.
The USD/JPY closed up on Friday.
The dollar gained against the Swiss Franc too.
The EUR/USD and GBP/USD closed down on Friday, however, against the dollar.
The US Dollar Index closed up 101.64, or 0.52%.
A strong dollar will continue to "impede" U.S. exports and is causing many producers to reconsider their crop rotations, switching from wheat to more profitable and higher performing crops, such as corn and soybeans, according to a report by CoBank.
A combination of market factors is reconfiguring the U.S. grain and farm supply industries and commodity prices.
According to a new report from CoBank, continued low commodity prices, increased foreign competition and the strong U.S. dollar will increase stress on American crop and animal supply chains.
This will increase industry consolidation, which shall launch the next phase in the growth of the agricultural industry.
Prices across the crops sector shall remain low as a result of a this oversupply in corn, and soybeans and wheat.
Whilst low commodity prices are also propelling consumption and overall global demand.
Strong production will outpace demand during the next three years, unless there is an extreme weather event in a major agricultural producing country.
"The U.S. grain and farm supply industries have reached another historic inflection point that will be good news for some and bad news for others," said Tanner Ehmke, CoBank senior economist and author of a new report on industry trends for the next two years. "The co-ops that thrive through this cycle will be those that offer innovative products and services to their farmer customers, are earnest and unrelenting in controlling costs, are properly aligned in the industry chain, and focused on risk management. These co-ops ultimately end up well positioned as the industry realigns."
The increased competitiveness of foreign producers – countries like Argentina, Brazil and Russia – have expanded production to take advantage of the export opportunities created by their weaker currencies.