Stable but uncertain year ahead for New Zealand primary exports – MPI

His comments to Rural News came at the launch of the final outlook for the sector just before Christmas. The report predicts that our primary exports for the year ended June 30, 2026, will hit a record $62 billion - just 3% up on last year.

This modest increase is led by an expectation that meat and wool revenue will be up 7% to $13.2 billion and horticulture up 5% to $9.2 billion. Forestry exports are predicted to be a modest 2% up on last year to $6.30 but the revenue from the mainstay of NZ's main primary sector revenue earner is up by just 1% to $27.4 billion.

One of the big gains for the sector comes from meat and wool exports. The report says tight sheep and beef production is driving up prices despite the lower volumes being produced. These prices outweigh the current challenges in the sector in US and Chinese markets, but the report adds that global tensions are affecting the market. It suggests that, given this, more frozen product is likely to be exported. Finally, it notes that the average farm profit before tax will increase by 20% to $166,500.

Smith says the news is great for the red meat sector, coming as it does after a couple of very tough years. He says there's a shortage of supply worldwide of red meat protein, so NZ will fill that gap, even if our own volumes are down a bit.

"Beef and veal exports are expected to make $5.1 billion and increase to $5.5 billion in 2027.

"Likewise, lamb is trending upwards to reach $3.8 billion next year and to close in to $4 billion a year later, and wool is up slightly, but again the trend is positive for the following year," he says.

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Horticulture remains a rising star in the sector with kiwifruit leading the way, with exports from NZ alone hitting $4.3 billion by next June, meaning that the returns per hectare are strong, according to Smith. He says the other hort area performing well is apples and pears, which are well over the $2 billion mark.

Smith says the uncertainty facing the sector is caused by the situation with tariffs and the geopolitical tensions that exist around the world. But he says, at the same time, our markets are proving to be extremely resilient and NZ's production capability has been stable.

"The world wants our products and the reason it relies on us is because what we are best at is producing and exporting food," he says.

Farmer Confidence Returns

Agriculture Minister Todd McClay says hitting the $62 billion mark is an outstanding result considering that it's been a tough year with extreme weather challenges in NZ and the impact of global tensions.

He says farmer confidence is back up, farm profitability is improving for many producers, and NZ is turning the corner out of recession thanks to our export-led economic recovery.

McClay says the rise in primary exports is not just luck but comes through the hard work of farmers and horticulturists. At the same time, he says government has been working hard to simplify rules in rural communities to cut costs and free up farmers to do what they are best at.

However, he is aware of the uncertainty that lies ahead.

"NZ exporters have adapted well to that and are making decisions for themselves and judging risk. What you have seen is a movement in some areas of product into China and Europe because they offer better returns and less uncertainty," he says.

The Situation and Outlook for Primary Industries December 2025 report.

At the same time the Horticulture Minister, Nicola Grigg, says horticulture is an exciting space and is going from strength to strength. She says statistics show that since 2021, horticulture exports have risen from $6.5 billion to $9.2 billion and the predictions are that this rise will continue.

Sweet Tooth

Like all reports, there is always something that pops up unexpectedly and in this case it's a sweetener of sorts - yes, it's chocolate.

Last year it earned $215 million and is expected to rise by 7% to $440 million in 2026 and by another $10 million in 2027. MPI Director-General Ray Smith says this is a great story with Canada and Australia being the two main markets.

"NZ chocolate is trusted, especially in Australia, because there is confidence about what is in the ingredients. I think what consumers are saying is that when I am buying chocolate, I want to know what's in it and what they expect to be in it and that's what they get it from NZ," he says.

MPI director-general Ray Smith.

Ray Smith recently visited some of our major markets Australia, the USA, Japan, Korea and China where he met his counterparts. He says in all those markets NZ is highly regarded, trusted and enjoys positive relationships.

"But what really struck as I went through Japan and Korea was that they talked very fondly about NZ products. They said they trusted them and how they are made and what was in them. But what they also said was NZ needed to raise its profile and push a bit harder and market ourselves a little better because we were less visible than our Australian counterparts," he says.