Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Drought makes high New Zealand dollar unjustifiable

27 February 2013

Drought makes high New Zealand dollar unjustifiable

With widespread dry conditions and the first adverse event declaration in Northland related to drought, Federated Farmers believes there is no justification for the high New Zealand dollar.

“It seems dairy production is not just falling but in some key areas is starting to crash,” says Bruce Wills, Federated Farmers President.

“DairyNZ confirms Northland’s February milk production is some 20 percent down year to date while in the Waikato, it is about 15 percent down. Speaking to Kevin Robinson, the vice-chair of Federated Farmers Dairy, milk production at his farm is down 15-20 percent and is falling daily.

“Given there is still a fair proportion of the dairy season left to run, dairy farmers are either on once a day milking or looking at drying cows off. Once that takes place, it is the end of milking until August

“When you put this effect on dairy together with the way meat and fibre farmers have rapidly destocked over summer, New Zealand’s two leading exports are under the gun.

“It needs to be remembered that the North Island is now where most of New Zealand’s sheep and beef cattle are located. In addition to Northland, key sheep and beef areas on the North Island’s East Coast, Waikato, the Bay of Plenty and the top of the South Island are very dry.

“We can add into the mix inland Taranaki, the West Coast of the South Island and even Southland

“We have also spoken to colleagues in horticulture, another one of our top-ten exports and they are now finding things increasingly tough as well.

“When you put all of this together the economic fundamentals provide no justification for the substantially overvalued Kiwi dollar. Any short term uplift in commodity prices will likely reflect supply concerns and while helpful, it won’t provide a cash boon for farmers or the economy.

“The droughts of 2007-9 cost New Zealand $2.8 billion and these were widely seen as tipping points for the last recession.

“The dollar is like a balloon and drought declarations ought to be the sharp pin,” Mr Wills concluded.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

What Winter? Temperature Records Set For June 20-22

The days around the winter soltice produced a number of notably warm tempertaures. More>>

Conservation Deal: New Kākāpō Recovery Partnership Welcomed

Conservation Minister Maggie Barry says the new kakapo recovery partnership between DOC and Meridian Energy is great news for efforts to save one of New Zealand’s most beloved birds. More>>

ALSO:

Tech Sector Report: Joyce Warns Asian Tech Investors View NZ As Hobbits And Food

Speaking in Wellington at the launch of a report showcasing the value of the technology sector to the New Zealand economy, Joyce said more had to be done to tell the country's technology stories overseas. More>>

ALSO:

Mediaglommeration: APN Gets OIO Approval For Demerger Plan

APN News & Media has received Overseas Investment Office approval for its plan to split out its NZME unit ahead of a potential merger with rival Fairfax Media's New Zealand operations. More>>

New Paper: Ninety-Day Trial Period Has No Impact On Firms' Hiring

The introduction of a 90-day trial period has had no impact on hiring by New Zealand companies although they are now in widespread use, according to researchers at Motu Economic and Public Policy Research. More>>

ALSO:

Corrections: Serco Exits Equity Stake, Remains As Operator

Serco has sold its equity stake in the company that holds the contract to design, build and run Wiri Prison in South Auckland but continues as sub-contractor to operate the facility. More>>

GDP: NZ Economy Grows Faster-Than-Forecast 0.7%

New Zealand's economy grew at a faster pace than expected in the first quarter of 2016 as construction expanded at the quickest rate in two years. The kiwi dollar jumped after the data was released. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news