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Chart of the week: Strong dollar shreds US wheat exports

The soaring dollar is causing a nasty decline in US wheat exports, set to fall to a 44-year low in the year to next June, helping to wipe 38% off American farm income in 2015.

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The soaring dollar, at a 13-year high in trade-weighted terms, is causing a nasty decline in American wheat exports and farmers' incomes, says The Wall Street Journal's Jesse Newman.

Due to the strong currency, wheat importers have to pay more for US grain than for wheat from rival producers. They can offer a lower dollar-denominated price because their home currencies are weaker. This month a tonne of American wheat cost around $205, while comparable French wheat fetched $193.

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Prices have also been under pressure in any case due to a glut in the global market. World wheat inventories are set to reach a record high next year, according to the US government, rising by 7% from this year's level.

The upshot? US wheat exports are set to fall to a 44-year low in the year to next June, helping to wipe 38% off American farm income in 2015.

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