Primary sector exports are set to surge almost $5 billion higher than originally forecast.
The Ministry of Primary Industries' Situation and Outlook for Primary Industries (SOPI) forecast update shows an upward trend for agriculture, forestry, and fishing exports by $4.9 billion to $36.4 billion revenue for the year to June 30, 2014.
“This is more economic good news and shows how the primary industries continue to underpin the New Zealand economy,” Primary Industries Minister Nathan Guy said at the release of the updated forecast.
“It’s very pleasing to see dairy sector returns forecast to rise by $2.7 billion in 2013/14, and a $1.2 billion increase in meat exports over the same time.”
Mr Guy said log prices also increased by 30% in the second half of 2013 and forestry firms are expected to take advantage of higher international prices by increasing harvest volumes.
It is anticipated this will lead to an additional growth in returns of $800 million in 2013/14.
Responding to the report, Federated Farmers president Bruce Wills said New Zealand is on track to double primary exports by 2025 to $64 billion as long as the country continues with sensible and sustainable policies.
"Between now and 2025, $18 billion of this future growth is expected to come from water storage, irrigation and aquaculture. New Zealand does not lack water, as in Australia; just the means to store it in times of plenty, to use it in times of shortage.”
"Of that $18 billion uplift, a fair proportion is expected to come from free trade agreements, like the Trans Pacific Partnership.
"Lifting every farmer into the top quartile of performance will be worth $3 billion by 2025 while bringing Maori land into full production is estimated to be worth $8 billion generating 3500 new jobs,” Mr Wills said.