AUSTRALIA'S farmers have taken an $8 billion hit since the start of last year because of the soaring dollar, the nation's top farm body estimates.
The National Farmers' Federation says miners and speculators are to blame for forcing the dollar up and hurting farmers.
The comments came as the dollar traded at US94.6 cents this morning, its highest level in more than two years, with warnings that interest rates could soon rise.
"Farmers have been hit hard by the high dollar, which is being driven by the mining boom and by currency speculators playing the market in expectation of interest rate rises here,'' NFF economics manager Charlie McElhone said.
"We just hope the Reserve Bank of Australia takes account of the impact on farmers of the high dollar when it makes its rate decisions.''
The NFF said farmers were highly dependent on exports, with every 1 per cent lift in the dollar sliced $210 million from farm bottom lines. The dollar is now almost 40 per cent above January last year, when it was just under US68 cents.
"If the dollar stays this high for the next year, farm incomes will be $8 billion lower than if it was at January 2009 levels (of US68 cents),'' Mr McElhone said.
RBA Governor Glenn Stevens said yesterday a "robust'' economy and higher inflation over the next year could force the RBA to lift interest rates.
Cattle Council of Australia executive director David Inall said beef farmers were "always nervous'' when the dollar crept towards parity with the US.
"We've been lucky that cattle prices have been rising recently, but if the high dollar continues, we might see downward pressure on prices,'' Mr Inall said.
Just as harmful was the dollar's volatility.
"When the dollar bounces around, as it has this year, it's harder for exporters to hedge against currency fluctuations,'' he said.
