Kiwi biggest risk to govt forecasts for farm, forest exports 11 Jun 2012
- UPDATE: Diligent shares soar 26% after takeover offer Business
- NZ services sector activity falls for a second month Business
- UPDATE: Allnex Belgium makes 'attractive' bid for Nuplex Business
- Queenstown Airport boosts 1H profit 31% Business
- BNZ gives $50,000 support to Kiwi startups targeting US Business
- Contact maintains dividend despite first-half loss Business
- McCully to visit Fiji News
- Property For Industry boosts full-year profit 21% Business
- Buyout firm offers 31% premium to acquire Diligent Business
- Allnex Belgium makes 'attractive' proposal to buy Nuplex 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.
5 Feb 2016 News
05 February 2016 Museum of Waitangi set to become a national and visitor Icon The new Museum of Waitangi, opened today by the... more
5 Feb 2016 Business News
Article - BusinessDesk NZ wool prices slip on higher kiwi dollar, reduced demand from China By Tina Morrison Feb. 5 ... more
5 Feb 2016 Business News
Article - BusinessDesk NZ directors more aware of risk, focus on cyber security Feb. 5 (BusinessDesk) - Directors of... more
5 Feb 2016 Lifestyle
4 February 2016What it is to be a Kiwi may depend of where you live – Auckland or elsewhere in New Zealand – with... more
4 Feb 2016 Property
Auckland's house sales volumes jump to 8-year high in January, Barfoot says Feb. 4 (BusinessDesk) - Auckland residential... more
5 Feb 2016 Migration
This Waitangi Day, New Zealand will roll out the welcome mat to 24 new citizens at Government House, and acknowledge over... more
21 Dec 2015 Migration
Article - Businesswire NZ net migrants reach all-time high 63,700 in boom November year for travel By Jonathan Underhill Dec. ... more
22 Jan 2016 Travel & Tourism
New Zealand Government Hon Nicky WagnerMinister of Customs 22 January 2016 More than 100,000 SmartGate users in one week Customs ... more
21 Jan 2016 Travel & Tourism
Wellington ratepayers to pay $8mln over 10 years for Canberra flights Jan. 21 (BusinessDesk) - Wellington City Council is... more
5 Feb 2016 Multisport
70 teams from 11 nations will come together in Kaiteriteri, Tasman this April for the fifth chapter of New Zealand’s premier ... more
22 Jan 2016 Opinion
We seem to be living in an era of virtual government, where governments promote only an illusion of policy kapow! rather than the... more
24 Dec 2015 Opinion
Column - Gordon Campbell Gordon Campbell on the Dotcom extradition decision Inevitably – and with justification –... more
5 Feb 2016 Appointments
New Zealand Government Hon Christopher Finlayson5 February 2016 GCSB Chief Legal Advisor Lisa Fong will become the Acting Director... more
22 Jan 2016 Flying Kiwi*
Warren and Mahoney Heading to Europe And the Olympics of Architecture Architectural graduate Antonia Lapwood has been awarded the... more
11 Dec 2015 Recruitment
11 December 2015 Minister for Tertiary Education, Skills and Employment Steven Joyce and Minister for Social... more
4 Dec 2015 Recruitment
New Zealand Government Hon Steven Joyce Minister for Tertiary Education, Skills and Employment 4 December 2015 Tertiary Education,... more