Kiwi biggest risk to govt forecasts for farm, forest exports 11 Jun 2012
- MARKET CLOSE: NZ shares gain, led by Xero Business
- NZ dollar heads for 1.4% weekly drop post-Wheeler comments Business
- Puhoi - Warkworth "holiday highway" gets the big tick News
- Carbon tax axe will boost Australian renewables: Trustpower Business
- Kiwibank exits Goodman Property's $600 mln lending syndicate Business
- NZ businesses still upbeat, confidence on the wane Business
- UPDATE: Scales shares edge lower on NZX debut Business
- Scales shares edge up 0.6% on NZX debut Business
- ASX-listed InvoCare unit cleared to buy Chch crematoriums Business
- Auckland Airport cuts fine deal in US$250M bond issue Business
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.
25 Jul 2014 News
July 25 (BusinessDesk) - A board of inquiry has given the go-ahead on the $760 million Puhoi-to-Warkworth highway. Dubbed the... more
25 Jul 2014 Business News
Article - BusinessDesk Auckland Airport cuts fine deal in US$250M bond issue By Paul McBeth Jul. 25 (BusinessDesk) - Auckland... more
24 Jul 2014 Business News
Article - BusinessDesk NZ dollar slides to 6-week low as RBNZ's Wheeler invokes intervention criteria By Paul McBeth July 24 ... more
23 Jul 2014 Entertainment
New Zealand Film Commission New Zealand Film 'The Dead Lands' to Have Toronto World Premiere Maori action epic The Dead Lands will... more
22 Jul 2014 Entertainment
Playing at this year’s New Zealand International Film Festival, Cap Bocage is a close-up exploration of the forces that came... more
14 Jul 2014 Property
July 14 (BusinessDesk) - New Zealand house sales fell in June from a year earlier, led by properties of $400,000 or less, indicating... more
11 Jul 2014 Migration
If you’re in the UK on a Tier 1 (General) visa, you’ll need to apply for an extension as soon as possible. The deadline... more
24 Jul 2014 Travel & Tourism
An increasing number of cycleways are attracting tourists to regions and scenic parts of New Zealand and a special session at the... more
17 Jul 2014 Travel & Tourism
Associate Tourism Minister Todd McClay has congratulated Tourism New Zealand on winning the Pacific Asia Travel Association’s... more
25 Jul 2014 Commonwealth Games
Darcina Manuel, formerly of Gisborne and now living in Perth, provided... more
25 Jul 2014 Commonwealth Games
Bronze for team pursuiters Published Friday 25 July 2014
24 Jul 2014 Opinion
One of the selling points in New Zealand’s campaign for a temporary seat on the Security Council is that we have a pluckily... more
23 Jul 2014 Appointments
New Zealand Government Appointments to Public Trust Board Justice Minister Judith Collins today announced the appointment of ... more
23 Jul 2014 Appointments
Commerce Minister Craig Foss today announced four reappointments to various independent Crown entities and statutory... more
14 Jul 2014 Recruitment
New Zealand Government Hon Steven Joyce Minister for Tertiary Education, Skills and Employment Hon Hekia Parata Minister of... more