Food and fibre export returns tipped to hit $55 billion

Food and fibre exports are predicted to reach a record $55 billion in the year to next June.

The Ministry for Primary Industries’ Situation and Outlook for Primary Industries (SOPI) report looks at how different parts of the sector are tracking — and it’s good news for all.

Dairy export revenue is expected to grow 6 per cent to $23.3b, driven by strong global prices and a weakening New Zealand dollar.

Red meat and wool exports are forecast to remain steady at $12.4b and horticulture is forecast to grow 5 per cent to just over $7b, thanks to high yields from this year’s grape harvest and rising prices for avocado, onion and wine exports.

Profits for the arable sector have also seen a lift, with a forecast of a

5 per cent increase of $265 million.

Seafood exports are continuing to recover after Covid-19 lockdowns around the world squashed demand.

Exports are forecast to grow 4 per cent to $2b, the report said.

“The food and fibre sector accounted for 81.4 per cent of New Zealand’s merchandise exports in the year to 30 June 2022. Primary industry export growth has exceeded that of non-primary industries for eight of the past 10 years,” it said.

Minister for Agriculture, Export and Trade Growth Damien O’connor said the projected record revenue has helped protect New Zealanders from the sharp edges of the global downturn.

“Despite the global economic storm gathering, the latest SOPI results show our food and fibre export revenue continuing to climb.

“There is some comfort knowing demand for food and fibre should remain strong throughout any global economic downturn, so New Zealand’s economy remains better positioned when compared to others, so long as we maintain our international competitive edge.”

O’connor said the forecast increase of 4 per cent in the year to June 30, 2023, is on top of our record export revenue achieved last year, and $2.9b higher than earlier forecasts made in June this year.

Forestry Minister Stuart Nash said forestry export revenue was expected to increase this year, despite the tough global economic environment.

“Forestry export revenue is set to increase to $6.6 billion in the year to 30 June 2023,” Nash said.

“This result is to be commended and the forestry sector should be acknowledged, especially over a tough year and in the face of a global slowdown in construction and corresponding lower demand for our logs. It shows remarkable resilience.”

He said the Government’s announcement on Thursday that what was counted as sequestration — accounting for greenhouse gas absorption by plants — would be counted for farm-level emissions pricing was a clarification, not a U-turn. Originally the Government had excluded it, causing an adverse

reaction from farmers.

Scientific research was needed to ensure that what was included across the farm system was credible and internationally recognisable, O’connor said.

The Government had committed more than $300m to this work, he said, with $172m going into a joint venture while the rest of the funds would be used for research.

There was satellite technology available now that could count trees accurately.

The methane targets would be reviewed in 2024, with a 10 per cent reduction goal by 2030, although four of the bigger companies have set higher targets .

“This is something that we can again lead the world in and be very proud of.”