Home / Knowledge / News / Exporters to struggle with a high Australian dollar
Exporters to struggle with a high Australian dollar
31
Aug '11
Over half of small and medium-sized Australian exporters plan to increase their currency hedging activity in response to the high Australian dollar, according to the latest Commonwealth Bank Aussie Dollar Barometer.

In addition to the 53% of exporters planning to hedge their exposure, there were also over two-thirds (68%) of importers which said they plan to hedge their USD exposure over the next three months, a significant jump on the results one year ago.

The Barometer tracks small and medium-sized importers and exporters' exposure to the Australian dollar, their expectations for trading levels and hedging plans for managing foreign exchange risk.

According to Joseph Capurso, Currency Strategist at the Commonwealth Bank, the tough conditions being felt by many exporters were now painfully clear, with exporters continuing to restructure their business operations and plan more proactively in order to stay competitive.

“The reality is that the pressure brought about by the high Australian dollar means that these firms are being required to make changes to their business to lift productivity. Based on exporters' predictions for the dollar of US$1.17 by the end of 2011, they will continue to feel this impact for some time.”

The results of the latest report follow previous findings which identified that exporters also believed they were uncompetitive when the Australian dollar moved into a range of US$ 0.90-1.00 and as a result had planned on reducing selling prices.

The Barometer reveals medium-sized businesses are suffering the most, with a higher proportion of those with annual turnover of $150-500 million planning to cut jobs as a result of the high Australian dollar. In contrast, there were fewer businesses in the $5-25 million category looking to cut jobs.

Despite the bleak job outlook, the Barometer reveals that most small and medium sized businesses that export and/or import expect to increase their AUD/USD exposure in the next three months, a key indicator of future business expansion. While almost all importers (89%) expect to increase their exposure, less than one-third (30%) of exporters expect to increase their exposure.

“We've seen a continued shift towards hedging over the past year as businesses work to control costs and lift productivity” said Mr Capurso.

“There are of course two sides to the story. While exporters are continuing to struggle, importers are clearly benefiting from the ongoing strength in the dollar. In fact, 17% of importers are looking to increase their workforce and it is also this group that remain the most bullish on the dollar, expecting it to rise to US$ 1.23 by the end of 2011."

Commonwealth Bank


Must ReadView All

Apparel/Garments | On 23rd Sep 2017

AAFA urges negotiators to preserve TPLs in NAFTA

The American Apparel & Footwear Association (AAFA), an alliance of...

Textiles | On 23rd Sep 2017

SIMA urges Centre to re-look duty drawback rates

he Southern India Mills’ Association (SIMA) has appealed to the...

Textiles | On 23rd Sep 2017

PKR 690.65-mn budget for Pakistan Cotton Committee

The Pakistan Central Cotton Committee (PCCC) recently approved a PKR...

Interviews View All

Riddhika Shah
SS Homme

'Worsted wool is the ideal fabric for menswear'

Vasanth Kumar
Max Fashion India

‘Traditional high-street retailers are now willing to offer franchisees to ...

Yash Agarwal
Hitansh Online

Every market region has its own culture and trends

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Sanjukta Dutta
Sanjukta's Studio

<b>Sanjukta Dutta</b> creates unique garments by clubbing prints of...

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

September 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
74.5%
No
12.8%
Skip
12.8%

Total Votes: 47

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
61.7%
No
25.5%
Skip
12.8%

Total Votes: 47

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.2%
No
6.4%
Skip
6.4%

Total Votes: 47

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
70.2%
No
10.6%
Skip
19.1%

Total Votes: 47


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search