Red meat exports slump, thanks to China
Weaker pricing and demand from China continue to impact New Zealand red meat export earnings.
The Government's new plan to boost primary sector export earnings is bold but needs bigger numbers, says economist Cameron Bagrie.
He says the Fit for a Better World Action Plan launched last week by Prime Minister Jacinda Ardern will actually see primary sector exports fall from around 16% of gross domestic product (GDP) to 14%.
He says lifting primary exports by $10 billion per annum to bring in a cumulative $44b of earnings in a decade sounds big but it’s a growth rate of around 1.5% per year.
“Primary exports have averaged around 6% growth since 1990...the primary sector won’t be leading any recovery at 1.5%,” he told Rural News.
Bagrie points out that the baseline is for primary exports to grow at 1.9% without a roadmap.
With the roadmap announced by Ardern last week, the aim is to get it up to 3.4% per year.
Bagrie notes that the additional 1.5% growth adds $10 billion. A 3.4% growth rate adds a “bit over half” historical primary export experience and would see primary exports shrink as a share of GDP.
Agriculture Minister Damien O’Connor said the sector’s ability to record 4.5% growth to about $48 billion of exports in the past year despite Covid-19, highlighted demand for our top-quality products.
He points out that the $10 billion in additional revenue each year from 2030 generated is on top of other growth that takes place. The cumulative total of additional export revenue over the next decade could reach $44 billion.
O’Connor says it is important to understand that the average 6% growth is based on decades of volume growth through intensification and claims it’s widely acknowledged that model is no longer sustainable.
“Our Roadmap would see projected growth rise to 3.4%, to $10 billion annually in 2030 – that’s higher than the 1.9% growth anticipated without the roadmap,” he told Rural News.
“We have estimated that growth conservatively based on uncertainty caused by COVID-19. Boosting primary sector exports will help grow jobs.”
O’Connor says there is a limit on growth fuelled by more production.
Bankers have been making record profits in the last few years, but those aren’t the only records they’ve been breaking, says Federated Farmers vice president Richard McIntyre.
The 2023-24 season has been a roller coaster ride for Waikato dairy farmers, according to Federated Farmers dairy section chair, Mathew Zonderop.
Ministry for Primary Industries (MPI) director general Ray Smith says job cuts announced this morning will not impact the way the Ministry is organised or merge business units.
Scales Corporation is acquiring a number of orchard assets from Bostock Group.
Family and solidarity shone through at the 75 years of Ferdon sale in Otorohanga last month.
The Ministry for Primary Industries (MPI) has informed staff it will cut 391 jobs following a consultation period.
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