We didn't plan for currency exposure and are now facing major losses

We had a good harvest this year. This means we will have plenty of product. We bought everything we could from the farmers and moved it into our local warehouse. We planned to work three shifts in the factory and organized for more storage space in Europe and the US.

The production went smoothly and we started shipping product. We had never covered our currency exposure as we did not have enough volume. With the increased volume we thought about it but did not want to incur the expense.

By the time the shipment reached the warehouse the exchange rate had gone up which meant the wholesaler either increased his price in dollars or we made less in our currency. The difference was 4% and increasing. The situation with the Euro was worse.

By the time we finished processing the year’s harvest, our currency losses were greater that the profit from the increased production. If we wanted the breakeven we would needed to increase our US sales 12% and Eurozone sales by 15%.