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Primary industry exports are on track to hit a record $52 billion

Primary industry exports are on track to reach a record $52.2 billion for the current fiscal year.

Photo: 123RF

The Ministry of Primary Industries’ State and Prospect of Primary Industries (SOPI) report released this morning forecasts that export earnings will increase by 9% through June 30, 2022.

This will be the first time that primary industry exports have reached the $50 billion mark.

Dairy export earnings are expected to rise 13% to $21.6 billion.

Meat and wool exports are expected to rise 18% to $12.2 billion and horticulture by 2% to $6.7 billion.

After a difficult few years due to the Covid disruption, seafood export revenue is expected to increase 9% to $1.9m.

“Seafood exports have increased with the reopening of catering services and the rebound in demand. The growth is due to the strong performance of exports of key species, although the sector is not without challenges.

“Rising fuel prices, logistical constraints and higher shipping costs create uncertainty over the forecast period.” The report says.

Not all sectors saw an increase in exports, forestry export revenue is expected to fall by 4% to $46.2 billion, the decline is mainly due to lower export volumes, despite higher prices high, as well as a record harvest the previous year.

“Fewer logs have been exported due to freight congestion and continued uncertainty, jeopardizing profits as producers pay for delays. Domestic demand for wood is currently high due to strong growth in residential housing, which is reducing export volumes as more wood is consumed in the domestic market.

And export earnings from arable crops are expected to fall by 2% to $255 million due to a difficult season.

MPI managing director Ray Smith said it had been a tough two years, but the food and fiber sector had adapted to continue exporting strongly.

“This SOPI clearly demonstrates the continued economic success of our food and fiber sector and is only possible through the hard work and commitment of the sector to maintain operations throughout the pandemic.”

Agriculture Minister Damien O’Connor said reaching more than $50 billion in export earnings for the first time was a tremendous achievement.

“Farmers, producers and other actors in the supply chain have played such a crucial role in our economy. They have continued to provide quality products to Kiwis and overseas consumers while navigating global disruption and uncertainty.

“Our overseas markets demand high-quality, carefully crafted products, and this report indicates that our exporters are responding to these market signals.”

O’Connor said export revenues are only expected to continue to grow as many companies shift to a value versus volume approach.

Looking ahead to the year to June 30, 2023, food and fiber sector export earnings are expected to remain stable at $52.1 billion, strengthening export earnings in the horticulture sectors and forestry partially offsetting weaker export earnings in dairy, meat and wool, seafood, arable and processed crops. food and other product sectors.

But export revenue is expected to hit $56.8 billion in the year to June 30, 2026.

The report says the food and fiber sector accounts for 11% of New Zealand’s GDP and employs 367,000 people.