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Dairy boosting primary exports: MPI

NZN 4/04/2017 Jonathan Underhill

A jump in the value of dairy exports is enough to restore growth to New Zealand's primary sector exports for the June 2017 year, officials say.

Dairy exports are forecast to rise 8.7 per cent to $14.5 billion in the 12 months ending June 30, the Ministry for Primary Industries' March Situation and Outlook for Primary Industries says.

That's an improvement from the projection in December when growth of 3 per cent was forecast.

The improvement means total primary sector exports are now expected to rise 1.4 per cent to $37.5b in the year, compared with December's prediction for a 0.8 per cent decline.

A pickup in the value of dairy, forestry and horticulture more than offsets a slightly weaker projection for meat and wool in the ministry's latest forecasts.

"We expect dairy prices to continue to remain relatively stable (at higher levels than in the previous year) over the remainder of the season, buoyed by lower production coming out of the Southern Hemisphere," the ministry said.

"In addition, record forestry harvest volumes are expected to drive an increase in log exports, particularly for use in the Chinese housing market."

Meat and wool exports are forecast to fall 11.2 per cent to $8.2b in the year ending June 30, reflecting lower production volumes, especially for beef.

Horticulture exports are projected to rise 3.8 per cent to $5.2b, driven by apples and wine, spurred by a record apple harvest and strong demand for New Zealand wines, it said.

For 2018, total primary sector exports are forecast to rise 9.7 per cent to about $41.1b, just below the projection in December of $41.2b, with the forecast for dairy revised down to $16.8b from $17bwhile forestry exports are revised up to $5.9b from $5.6b.

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