The bustling export business is due largely to the exchange rate, according to Purdue Economist Chris Hurt. “The European euro has increased in value relative to the U.S. dollar by 40%. What that means is that with the same number of euros, Europeans can buy 40% more in the U.S. than they would have been able to buy three or four years ago.
“As an example,” Hurt says, “$12 soybeans in the Midwest are equivalent to $9 to the world at this point. This suggests that the world will not cut back on grain usage as quickly, because as buyers purchase using their own currencies they are not experiencing as high a price as we perceive these prices to be in the U.S.”