Just look at the chart on the site below.
http://finance.yahoo.com/currency/convert?from=USD&to=CAD&amt=1&t=5y
It is what happened to the price Canadians received for their cattle because the U.S. is their only market. As the currency goes, so goes the value.
This is the risk to producers who have one main foreign buyer with floating currencies.
In addition to the foreign exchange rate risk, the Canadian cattlemen have to deal with the regular cattle price cycles.
Does this keep producers in business or not? Does it increase or decrease the supply on the market as a whole when small producers go out of business? What is the ultimate consequence to the consumer in the long run? Do they benefit from lower numbers of small producers?
Can people who have the money buy Canadian cattle infrastructure easier or less easy? Tyson made a lot of money due to the low Canadian dollar. Now they can buy this infrastructure on the cheap with the Canadian dollars they earned. What does that do for small producers? What will happen when a Tyson type consortium buys up these assets? Will the benefits of a productive economy still go to small producers?
Will the processors lose money, not make as much, or just offer less for the cattle they get from Canadians?
http://finance.yahoo.com/currency/convert?from=USD&to=CAD&amt=1&t=5y
It is what happened to the price Canadians received for their cattle because the U.S. is their only market. As the currency goes, so goes the value.
This is the risk to producers who have one main foreign buyer with floating currencies.
In addition to the foreign exchange rate risk, the Canadian cattlemen have to deal with the regular cattle price cycles.
Does this keep producers in business or not? Does it increase or decrease the supply on the market as a whole when small producers go out of business? What is the ultimate consequence to the consumer in the long run? Do they benefit from lower numbers of small producers?
Can people who have the money buy Canadian cattle infrastructure easier or less easy? Tyson made a lot of money due to the low Canadian dollar. Now they can buy this infrastructure on the cheap with the Canadian dollars they earned. What does that do for small producers? What will happen when a Tyson type consortium buys up these assets? Will the benefits of a productive economy still go to small producers?
Will the processors lose money, not make as much, or just offer less for the cattle they get from Canadians?