Kiwi biggest risk to govt forecasts for farm, forest exports 11 Jun 2012
- Regulator trims 2015 national electricity line prices 1.1% Business
- Pacific Edge says it's on track after posting 1H loss Business
- VMob widens 1H loss as it chases international growtth Business
- New rules for financial markets to take effect News
- NZ dollar rises to record vs. ruble as OPEC maintains output Business
- MARKET CLOSE: NZ shares fall paced by Warehouse Business
- NZ dollar gains, benefiting from weaker euro, yen, pound Business
- NZ dollar gains, benefiting from weaker euro, yen, pound Business
- Opus trims executive structure in 'competitive market' Business
- MSD procurement a winner News
NZ dollar is greatest risk to government forecasts for farm, forest export growth
June 11 (BusinessDesk) – The risk of the kiwi dollar remaining higher than expected over the next four years is the biggest risk to government forecasts for growth in the nation’s farm, forestry and seafood exports, a new government report says.
The trade-weighted index is forecast to fall 8.4 percent to 64.7 by March 2016, with weakness against the Australian dollar and yen offsetting gains versus the greenback, pound and euro, according to the Ministry for Primary Industries 2012 situation and outlook report. The TWI was recently at 70.43.
If the decline doesn’t eventuate, revenue from dairy, meat, wool and forestry could be 20 percent below the ministry’s baseline assumptions, the report says.
“In the shorter term, weak European and US economic performance, and lower interest rates relative to New Zealand drive the assumed strength of the New Zealand dollar,” the report says. “Longer term, New Zealand’s high and growing level of international indebtedness is expected to be constrained by limits to lenders’ appetite for risk, eventually reducing the strength of the New Zealand dollar.”
The ministry’s baseline forecast is for the TWI to strengthen over the next nine months to reach 72.2 by March 2013. It would gradually ease back to 64.7 by March 2016. The kiwi dollar would be around 80 US cents by March next year, up from its current level of 77.69 cents, before easing back to 69 cents by 2016.
Among the nation’s biggest primary exports, fruit is forecast to show the biggest gain in gross revenue between now and 2016, rising 33 percent to $3.1 billion. Dairy, the biggest contribution to the nation’s overseas shipments, is forecast to lift revenue by 27 percent to $12.5 billion.
Cattle revenue would rise 13 percent to $2.5 billion and sheepmeat by 9 percent to $2.45 billion. Wool is the disappointment, with gross revenue forecast to decline 16 percent to $513 million. Among other commodity items, revenue from vegetables would rise 10 percent to $1.1 billion.
The forecasts show agriculture’s contribution to gross domestic product would rise to $12.2 billion by 2016 from an estimated $9.78 billion in the year ended March 31.
For the current 12 months ending June 30, dairy export sales are expected to rise 5.6 percent to $13.9 billion as strong production more than makes up for weaker global commodity prices.
“More than any other New Zealand primary industry, the dairy industry has ben able to tap into strong economic growth in emerging market economies,” the ministry says.
Meat and wool export sales would rise 5.8 percent to $7.2 billion, reflecting higher meat volumes and increased wool prices.
New Zealand’s primary industries have benefitted from increased trade ties with emerging Asia, most notably China, where “investment and private consumption remained strong because of China’s solid corporate profits and rising household income,” the ministry says.
“The outlook for New Zealand’s dairy and forestry exports depends to a large extent on the Chinese economy maintaining its momentum,” it says.
That contrasts with the European Union, where there is a risk of further economic deterioration, and the US, where a weak housing market is weighing on demand for forest products. South East Asian countries and Latin America are expected to continue to have stronger growth, it said.
27 Nov 2014 News
Foreign Minister Murray McCully travels to Brussels this weekend to attend the North Atlantic Treaty Organization (NATO) Foreign ... more
26 Nov 2014 Business News
New Zealand Government Foreign Minister thanks outgoing Chief Executive Foreign Minister Murray McCully today thanked outgoing MFAT... more
18 Nov 2014 Business News
Every year, several dozen butchers make an epic commute - from provincial New Zealand to rural Iceland - for just two months' work.... more
27 Nov 2014 Entertainment
New Zealand’s “Queen of the Blues” MaKuini has played a show at London’s legendary 100 Club to an enthusiastic... more
17 Nov 2014 Lifestyle
WAITANGI, New Zealand – When intrepid Hokulea crewmembers first sailed to Aotearoa (New Zealand) 29 years ago using the ... more
27 Nov 2014 Property
Revenue Minister Todd McClay says Inland Revenue’s proactive strategy to track down those attempting to avoid paying tax is... more
18 Nov 2014 Property
Social Housing Minister Paula Bennett is impressed with Housing New Zealand’s progress in building, redeveloping and repairing... more
24 Nov 2014 Migration
NZ net migration rises to fresh record in Oct as more kiwis return, Indian students arrive Nov. 24 (BusinessDesk) - New Zealand's... more
3 Nov 2014 Migration
Australians and New Zealanders should be granted special status to live and work in the United Kingdom without restriction, a new... more
26 Nov 2014 Travel & Tourism
New Zealand Government Flights between New Zealand and China are set to double under amended air services arrangements, says ... more
12 Nov 2014 Travel & Tourism
Nov. 12 (BusinessDesk) - New Zealand guest nights rose 1.1 percent to a record for a September month, driven by a rebound in ... more
27 Nov 2014 Sport
Hard work has been rewarded in the naming of the Golden Homes Black Sox softball team for next month’s ISF Oceania Qualifying ... more
26 Nov 2014 ASB Tennis
NZ Festival of TennisFeaturing some of the biggest names in world tennis, organisers of the ASB Classic are pleased to announce one... more
27 Nov 2014 Opinion
As anyone who’s ever encountered him around Parliament will verify, Chris Finlayson’s arrogance is matched only by his... more
26 Nov 2014 Opinion
Suddenly, we’re awash in inquiries and reviews. (It feels almost as if the Greens won the last election.) Caught out by the... more
26 Nov 2014 Appointments
New Zealand Government Commerce and Consumer Affairs Minister Paul Goldsmith today announced the appointment of Murray Jack as the... more
25 Nov 2014 Appointments
R.Tucker Thompson Sail Training Trust Dame Anne Salmond appointed Patron of Northland-based Sail Training Trust Former New... more
12 Nov 2014 Recruitment
Article - BusinessDesk Smiths City starts search for new CEO after Hellings signals exit By Paul McBeth Nov. 12 (BusinessDesk)... more