Shany I suppose no one could have posted the currency risk at a better time than you did.

[Hopperbin]

Our dollar just dropped 3 cents to the American in 2 days. I have the option of writing a certified check today in american funds and for 56,000 I expected a bounce today but the dollar kept falling. Helps the grain prices but new machinery payment is higher, by a lot. Crap we can borrow 100 grand these days for only just over 3 percent a year.

[charliep]

Actually the loonie is up a penny on the futures. I would do some checking on when you currency was established and perhaps their risk premium/fudge factor on however you are doing your currency conversion.

[charliep]

Actually when they did the conversion will have a big impact as well. A 1.5 cent spread futures between daily high low.

[Hopperbin]

must have been standing on my head today, down 2 cents yesterday up 1 today so it did bounce back, bigger question is why such a drop yesterday. Actually have the option of writing the certified check in american funds today or wait a week and do it on delivery. Just a bit shocked at a 2 percent drop. A thousand dollars here and there is not really a big deal when trying to get the crop off.

[charliep]

Suspect a bit the fact the Bank of Canada highlighting the fact the higher valued Canadian dollar is hurting the economy but more important perhaps is the normal ebb and flow of the market in these volatile uncertain times. Others will deal with the issue better than I will but note the overall move higher in commodities in the last couple of days. Some influence declining US dollar. See what other comments people have.

[dave4441]

Hopperbin-who are you using to exchange the money. Usually save a percent by going thru Custom House in Stoon as apposed to using a bank to exchange the funds. Rate will be current as well.

[cottonpicken]

Hopper-what do the flowers smell like on the moon?

[cottonpicken]

Cause you smell like sh....

[charliep]

Curious response.

So if you were making a USD $50,000 purchase in the next weeks, when would
do your currency conversion?

If were a Canadian exporting company with $10 mln of currency exposure in the
US market over the next 6 months, would you be fully hedged? What tool would
you use?

[dave4441]

Over a short period of time you might as well throw a dart, hedge today or 3 weeks from now, no currency trader would ever advise waiting over such a short period. It is anybodis guess.
If you are happy with the rate you might as well book it.

[Hopperbin]

The dealer just mentioned if I thought the dollar was going to fall I could get a certified check in American funds now and give them the check when dryer arrives. Actually not sure if that really protects me from a falling dollar or not, must talk to the Credit Union about that because I would think that the exchange would be worked out on the date the check clears I really don't know about that. Will check the clearing house I found them in the phone book, thanks. Not sure how the dealer handles currency exchange either so maybe if I pay them in Canadian and use what ever calculation they use maybe that is best. I will ride it out for now only a week away. Cotton I agree I am a dumb farmer, I can live with that

[mbratrud]

You should be able to open an account with your bank to hold US Funds. Have your Bank put the required funds in your USD account until the purchase is completed. Or if you have a futures trading account just have your broker move funds to the USD portion of your account.

[dave4441]

I handled a similar transaction for a friend for about $100,000 US and saved $3000 dollars over the credit union rate (they have no volumne), by shifting it thru custom House. It is very simple and they can give you a US dollar bank draft (paid from CDN bank) to hand to the guy on set up or delivery. Worth the call. The seller will do the transaction for you but will be in his favour with some juice. Of course you could get lucky and the CDN dollar be stronger at time of delivery.

[checking]

It's a $1.00/month to maintain a US $ cheque account at our local Credit Union.

On a $50,001.00 minimum Cad to US the exchange rate is .25%, or on that amount $125.00 if you ask them to phone in, and do the transaction through a currency broker. That's steep if you have a compulsion to do it frequently as a trader, but liveable if done a few times a year as a bargain hunter that cross border shops for farm purchases.

If you do not ask, the in house rate is 2.5% which is an "ouch" amount.

[Hopperbin]

Oh thanks everyone, a great learning experience for me and a money saver I am thinking. wish I could say drinks on me, and a double for Cotton if he is not passed out yet.