Value of primary industry exports expected to dip next year
The value of New Zealand's primary industry exports is expected to dip fractionally next year
The Ministry for Primary Industries (MPI) latest Situation Outlook for Primary Industries Report (SOPI report) showed total farm, fishing and forestry exports for the year to the June 2020 were forecast to fall 0.5 percent to $46.1 billion.
The outlook comes off the back of a 8.7 percent rise in export revenue for the year to June 2019, totalling $46.4b. The year prior there had been a massive 11.7 percent lift.
The report noted that growth had been partly thanks to record high export prices for red meat, as well as good weather conditions enabling a strong production season for both the horticultural and dairy sectors.
But a senior analyst at MPI, Matt Dilly, said weather conditions were not expected to be as favourable for the year to June 2020 and while prices are expected to remain high for most products, lower export volumes are forecast in most sectors.
Dairy and red meat volumes were expected to drop after benefiting from above average pasture growth last season, and lower log prices are expected to drive a decrease in forestry production and exports, Dilly said.
The current forecast was not negative, as the exponential growth the primary industries has experienced over the last two years was never going to be able to be maintained, he said.
"Just because things are slightly less strong than last year doesn't mean its a negative result," he said.
Dilly said growth was expected to return in 2021, supported by good prices and strengthening export markets.
The Agriculture Minister, Damien O'Connor said the latest report had showed some outstanding results, with total dairy export revenue up 8.7 per cent to $18.1b in the year to June 2019.
"Our nation's farmers and growers produce some of the highest quality food in the world - and the world knows it. They are bringing home record export returns and that's something for them to be really proud of. I'm certainly very proud of them," O'Connor said.
This article was originally published on RNZ and re-published with permission.