M.I.A.
OPINION: The previous government spent too much during the Covid-19 pandemic, despite warnings from officials, according to a briefing released by the Treasury.
Covid-19 is forecast to strip more than $1.3 billion dollars off New Zealand’s primary exports in the coming year, including $390 million off dairy exports.
This latest revelation comes in the Ministry for Primary Industries latest Situation and Outlook Report, released late last week.
In December MPI were forecasting that primary exports for the year ending June 2020 would be $47.8 billion – now this has been reduced to $46.5 billion, a mere 0.5% up on the 2019 total. It is also warning of further downward revisions. The report came out the day World Health Organisation declared coronavirus a pandemic.
The report states that while the geopolitical tensions on trade such as Brexit and the US-China trade war have eased somewhat, coronavirus has added new uncertainty for NZ primary exporters. It notes that the seafood and forestry sectors have been particularly badly hit. But it points in the last month dairy commodity prices have softened and the average price on the GDT fell 7.5%.
It says there has been weakness in milk powders, butter, and anhydrous milk fat. However, despite the disruptions in Chinese markets, North Asian buyers have continued to be active in recent auctions, with volumes traded higher than at the same time the previous year. It adds that prices for cheese and casein have continued to strengthen.
MPI predicts that continued declines in key commodity prices will impact farm gate milk price payouts but it says given the strength of current export prices, strong payouts are still likely and will continue to support dairy farmer profitability this season. It say an average payout of $7.15/kgMS is likely.
Fonterra will announce its half-year results this week: coronavirus is likely to have an impact.
Accoriding to MPI, while revenue from the dairy sector is down on the December forecast, it is still ahead of the previous year and is expected to earn about $19.2 billion. The report also notes that despite the drought in the major dairying regions milk production for the first eight months of the season was up by point five of a percent.
Meat and horticulture exports have also taken a hit with revenue from meat down by $220 million and horticulture by $110 million.
The as yet unknown factor says the report is the fate of the NZ dollar which has already weakened since the beginning of this year. MPI says should the weakening in our key agricultural commodity prices continue to worsen, they would expect further adjustments in the NZ$ to help offset some of these effects for primary sector exporters. And MPI warns further revisions downward in future forecasts are likely.
An independent report, prepared for Alliance farmer shareholders is backing the proposed $250 million joint venture investment by Irish company Dawn Meats Group.
Whangarei field service technician, Bryce Dickson has cemented his place in John Deere’s history, becoming the first ever person to win an award for the third time at the annual Australian and New Zealand Technician of the Year Awards, announced at a gala dinner in Brisbane last night.
NZPork has appointed Auckland-based Paul Bucknell as its new chair.
The Government claims to have delivered on its election promise to protect productive farmland from emissions trading scheme (ETS) but red meat farmers aren’t happy.
Foot and Mouth Disease outbreaks could have a detrimental impact on any country's rural sector, as seen in the United Kingdom's 2000 outbreak that saw the compulsory slaughter of over six million animals.
The Ministry for the Environment is joining as a national award sponsor in the Ballance Farm Environment Awards (BFEA from next year).
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