Improved lamb and mutton prices and increased exports of venison are forecast for the year ending June 2018.
The Ministry for Primary Industries (MPI) has revised its forecasts for the 2018 year in the latest update of its Situation and Outlook for Primary Industries, which shows the overall primary sector’s exports will grow by 8.5 percent in the year to $41.4 billion.
The growth is impressive and provides the sector a strong base to deal with the challenges ahead, says agriculture minister Damien O’Connor.
“This would be the largest annual increase since 2014 when dairy prices rose to very high levels,” he says.
Growth this year is spread across all sectors and these gains are expected to be built in a more sustainable foundation.”
Dairy exports lead the way with a forecast increase of 15 percent to $16.8 billion in 2018, despite the wet spring affecting production.
“Meat and wool exports are forecast to grow 4.2 percent to $8.7 billion, with lamb prices looking really good and beef, mutton and venison also doing very well,” notes O’Connor.
The December 2017 SOPI report shows a revised forecast for red meat and wool, up $230 million to $8.7 billion for the year ending June 2018. The main driver for this revision is a more positive outlook for lamb and mutton prices, resulting from strong global demand and a weaker production outlook in Australia. Beef exports are forecast to perform at the same level as last year, despite a small production fall due to lower cull cow numbers.
Animal co-products are forecast to lift 11 percent in the year ending June 2018 to $650 million, based on further expansion of deer velvet and animal-based blood products, both high-value products with robust demand, the report notes. Blood products are a rapidly growing export category for New Zealand, increasing from $53 million in 2012 to $125 million in 2017.
“This is aided by recent investments in processing facilities, renewed market access to China following a two-year hiatus for commercial quantities of bovine blood products and strong global demand for pharmaceutical products such as bovine serum albumin.”
In addition, venison exports are forecast to increase 11 percent to $180 million in 2018, driven by stable production and rising prices.
“We are a primary producing nation and it is very encouraging that the prospects for the primary industries look so bright,” comments O’Connor.
“However, New Zealand and other primary producing nations face the global challenge of sustainability – we need to provide good quality, nutritious food for a rapidly rising global population, but we must do this in a way that is sustainable.
“This means placing an even greater focus on high-value production, sustainable resource use, managing the risks posed to our primary sector by harmful pests and diseases and meeting ever-changing consumer demands,” the Minister says.