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Export revenue predicted to grow says MPI

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The Ministry for Primary Industries is predicting steady export growth over the next 4 years in its latest Situation and Outlook for Primary Industries, released today.

MPI Director of Sector Policy, Jarred Mair, says the latest Situation and Outlook for Primary Industries highlights the resilience of New Zealand’s primary industries and their growth prospects, and provides a positive outlook through to 2019.

“For the year ending June 2015, we expect primary industries total export revenue to be $35.2 billion, down 8% from 2013/14. This is despite substantial expected declines in export revenue for dairy (22% decrease) and forestry products (10% decrease). We then expect a return to growth with a 1.5% increase in export earnings for 2015/16, to $35.7 billion.

“Longer-term the outlook is for steady growth across all sectors. Total export revenues by June 2019 are expected to be $41.3 billion – a 17% increase on this year.

“This growth will be underpinned by income and population growth in China and Southeast Asia. Steady growth in other key markets will further bolster growth. For example – expectations of sustained recovery in the US housing market bodes well for higher-value forestry exports.”

“The last 12 months have been an example of the benefits of having a diversified production base and highly adaptable export companies. It was a tough year, with volatility in overseas markets for some of our key export commodities, and challenges to production from climatic events such as drought, storms and floods.

“China remains our most important market for primary industry exports. Demand drove dairy prices high heading into 2014, and its construction boom helped lift forestry export earnings. However, excessive inventories and slowing construction have reversed these price gains for the 2015 year. Volatility in dairy markets has been further exacerbated by abundant milk supply from other exporting countries and from geopolitical factors such as the Russian trade sanctions.

“There’s no denying that it’s hard going right now for some of New Zealand’s primary industries but we are forecasting better times to come”.

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