NZ commodity exports seen rising 9.2% in 2018, MPI says in latest sector report
Oct. 19 (BusinessDesk) - New Zealand's primary sector exports are expected to rise 9.2 percent in the year to June 30, 2018, according to the latest Situation and Outlook for Primary Industries, little changed from the assessment in June.
The Ministry for Primary Industries has begun publishing its SOPI on a quarterly basis. Total primary sector exports are forecast to be $41.62 billion in the June 2018 year, compared with the $41.57 billion estimate it gave in June. Its projection for the 2019 year was revised to $42.4 billion from $42.5 billion.
MPI said its forecasts are based on dairy prices remaining strong this season and "a return to normal productivity levels across most sectors following adverse weather last year."
Its projections for dairy barely budged between June and September. Dairy exports are expected to rise 19 percent in 2018 to $17.35 billion before slipping back to $17.3 billion in 2019. Dairy exports expanded by $1.3 billion in the 2017 year even as milk solids production on farm fell 0.6 percent.
"Export prices began to recover midway through last year, and the continuation of that trend should flow through to another strong year of export revenue gains," MPI says. "We anticipate that New Zealand's milking herd numbers will stay near current levels, yet on-farm production is likely to increase, assuming climatic conditions improve."
Within dairy, whole milk powder exports are seen chalking up steady growth in the next two years, while butter, anhydrous milk fat and cream are forecast to surge in 2018 before slipping back in 2019.
Meat and wool exports are forecast to rise 1.7 percent to $8.48 billion in 2018 and gain 2.9 percent to $8.7 billion in 2019. Exports fell 9 percent in the June 2017 year.
Forestry exports are expected to rise 5.2 percent to $5.76 billion in the current year and 1.9 percent to $5.88 billion in 2019, while horticultural exports are forecast to rise 4.9 percent to $5.4 billion in 2018 and increase 5.8 percent to $5.72 billion in 2019, with kiwifruit, wine, apples and pears rising.
Seafood export revenue is forecast to gain 6.2 percent to $1.85 billion in 2018 and 4.5 percent to $1.93 billion the following year. Arable export revenue is expected to jump 8.8 percent to $205 million this year and gain 3.6 percent to $215 million in 2019.
The segment called 'other' and includes honey, sugar and confectionery, cereal products and live animals is seen rising 1.1 percent to $2.56 billion this year and gaining 1.7 percent to $2.6 billion in 2019.