Brazilian agricultural exports - from soybeans to pork - are grappling with the impact of the soaring Brazilian real against the dollar.

Some industry experts warn that the unfavorable foreign-exchange relationship could severely curb commodity exports, though others disagree.

The real has gained about 17% against the dollar in 2009, including a 12% jump last month. One dollar is hovering around 1.94 Brazilian real Thursday, having last week broken through the psychological BRL2 mark.

"This [BRL2 rate] is a disaster for Brazilian soybean exports," a chief trader at a major U.S. soy exporter said this week.

The trader said that exchange rate is terrible for Brazilian exports in general. The dollar could even slump to its lows of BRL1.55 last August, he said.

This would hurt Brazilian soy farmers, who see the exchange rate eating away price gains in the dollar-denominated soybeans.

Even as the real rises, he said, Brazil has already shipped about 15 million tons of beans across the globe.

Brazil's soy exports rose to a record 4.6 million metric tons in May from the 4.4 million tons exported in April, the Foreign Trade Ministry said. Brazil's soybean exports were 4.4 million tons in May last year.

Exporters have already made a lot of money this year, he said. Brazil has seen strong volumes flowing to Asia and particularly China this year and prices have also been good, he said.

But Steve Cachia, a grains analyst at local consultancy Cerealpar, said that Brazilian producers will have little choice but to export their beans whatever the exchange rate. The local soy market will need to adjust to the new reality, he said.

Cachia added that soy price rises at the Chicago Board of Trade have helped to remove the currency sting. If prices on the CBOT fall, the impact of the worse exchange rate will hurt producers much more, Cachia said.

In the Brazilian coffee market, John Wolthers, a trader at coffee exporter Comexim in Santos, said that the dollar is the brake and accelerator of the trade. The foreign-exchange rate recently contributed to damping Brazilian coffee trade despite rises in international coffee prices, he said.

Dantes Hurtado, U.S. food maker Sara Lee's (SLE) general manager in Brazil, played down the impact. "Brazilian coffee exports will remain steady, because there's nobody to replace Brazilian coffee," he said.

Hurtado said Brazilian coffee accounts for around 40% of the world's supply, so there is no alternative. Global consumption has held steady despite the crisis, and as a result coffee companies will need to import more beans, he said.

In the meat and poultry sector, Pedro de Camargo Neto, president of Brazil's Pork Industry Association, or Abipecs, said that the exchange rate is a looming "catastrophe."

Existing pork exports have already been earmarked, meaning volumes will likely be steady this year, he said. But financial losses will certainly rise and this may jeopardize future production, he said.

Joster Macedo, president of poultry processor Tyson do Brasil, a subsidiary of Tyson Foods Inc. (TSN), is more optimistic.

The real has strengthened partly because of improving global economic conditions and better commodity prices, Macedo said.

It is difficult to predict a range, but one dollar is likely to be in a band of BRL1.90 and BRL2.1 this year, he said.

Macedo said that all competitors are affected so the burden is placed on everyone. Indeed, a silver lining is that for imports such as some animal feedstock, costs are likely to be less as the dollar weakens.

Whether the dollar goes up or down, Tyson expects to be in a strong position. "We will make money either way," Macedo said.

Brazil is the world's No.1 exporter of coffee, sugar, chicken, orange juice and the No.2 exporter of soybeans.

By Tony Danby; Dow Jones Newswires; 55-11-2847-4523; Anthony.Danby@dowjones.com