business

New Zealand’s economic prospects for primary sector "bright" after tough year: minister

WELLINGTON, Dec. 15 (Xinhua) — The economic prospects for New Zealand’s primary sector are bright despite the significant challenges from COVID-19, Agriculture, Trade and Export Growth Minister Damien O’Connor said on Tuesday.

The latest Situation and Outlook for Primary Industries report forecast food and fiber export revenue of more than 47.5 billion NZ dollars (33.7 billion U.S. dollars) for the year ending in June 2021, and a record 49.2 billion NZ dollars (34.8 billion U.S. dollars) for the following year, according to O’Connor.

“This strong performance is a testament to the sector’s ability to adapt to keep businesses operating and workers in jobs. Producers are working to keep staff and communities safe from COVID, and provide the food and fiber products needed at home and abroad,” O’Connor said.

“The star performers this year include the horticulture sector,” he said, adding that the horticulture sector’s export revenue is forecast to hit nearly 7.1 billion NZ dollars (5.03 billion U.S. dollars), an increase of 8.9 percent from the previous year. It’s driven by successful harvests in early 2020 and continued strong demand for fresh fruit and wine.

“Further increases in export revenue of 5.3 percent are expected for the arable sector for the year ending June 2021, on the back of a bumper 23-percent increase the previous year,” he said.

Forestry Minister Stuart Nash said forestry exports are showing good signs of recovery. “Strong demand for logs from China and for sawn timber from the United States is driving the recovery in our forestry exports,” Nash said.

O’Connor said export revenue for some sectors is forecast to drop for the year to June 2021 but expected to bounce back even stronger the following year.

Dairy export revenue is forecasted to decrease 4.6 percent to 19.2 billion NZ dollars (13.6 billion U.S. dollars) for the year to June 2021, driven by weaker global dairy prices, as markets continue to deal with the impacts from COVID-19, O’Connor said.

“However, this should be offset by high demand for our dairy products, particularly from China, to support strong sector profitability over the medium-term, with export revenue expected to reach 20.1 billion NZ dollars (14.2 billion U.S. dollars) in the year ending June 2022,” he said.

While the impacts from COVID-19 will be seen for some time, New Zealand is well placed to recover, O’Connor said.

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