The Canadian loonie is at about 1.002 against the U.S. dollar, according to the Bank of Canada.
Ray Mastronardi, director of sales and purchasing for Del Fresco Produce, Kingsville, Ontario, had this simple take on what it all means.
“Good if you are an importer, bad if you are an exporter,” he said. “We export a large percentage into the USA. It has reduced our margins.”
More than 70% of Ontario’s greenhouse volume is exported to the U.S., according to Leamington-based Ontario Greenhouse Vegetable Growers.
For decades, the U.S. dollar was by far the dominant currency in North America, with the Canadian dollar trading as low as 0.6179 cents against the greenback in January 2002.
In September 2007, the loonie finally caught up to the dollar, and things have been more challenging for Canadian exporters since then.
“It is just a factor that we have had to adapt to,” said Mark Slater, director of Erie James Ltd., Leamington.
Inconsistencies in the exchange rate make planning tough, said Matt Mastronardi, vice president of sales and marketing for Pure Hot House Foods Inc., Leamington.
“When trying to forecast cash flows from the operations standpoint at the farm level, it makes it difficult since no one knows where the dollar is going to be,” he said. “Also, for contracts, it’s been tough. Last year alone you saw a 10% difference from start to finish.”
Salesman Kyle Moynahan said the exchange rate challenges Jem-D International, Leamington, to drive efficiencies at all levels of its operations.
"The exchange rates affect our net returns to our farms both in Mexico and Canada,” he said. “The stronger the U.S. dollar, the higher the net returns to our farms.”