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

 

Trade Agreements: TPP Minus US Starting To Gain Ground

The Japanese government is picking up the pace on reviving the Trans-Pacific Partnership trade and investment deal, with talks scheduled next month among the 11 countries left in the pact after the withdrawal by the US after the election of president Donald Trump. More>>

ALSO:

PACER:

Prices Up 2.2%: Annual Inflation Highest In Over Five Years

"Rising petrol prices along with the annual rise in cigarette and tobacco tax lifted inflation," prices senior manager Jason Attewell said. "Petrol prices in New Zealand are closely linked to global oil prices, and cigarettes and tobacco taxes rise in the March quarter each year". More>>

ALSO:

Undertaxed? NZ Income Tax Rate Second Lowest Among Developed Nations

New Zealand workers pay the second smallest portion of their income to the government among developed nations and less than half the average ratio of their Organisation for Economic Cooperation and Development peers. More>>

ALSO:

Cyclone Cook: Round Up Of This Week’s Weather

One of the significant impacts this week was flooding due to excessive rainfall amounts. Rainfall amounts topped out at 350mm over the past 60 hours in parts of northwest Nelson, with 200mm+ measurements recorded about Coromandel Peninsula, and between 150-200mm in the Kaimai Ranges. Rainfall amounts of between 30-50mm were commonplace elsewhere. More>>

ALSO:

Earlier: Batten Down The Hatches For Cyclone Cook

Although fast-moving, Cyclone Cook will be destructive and MetService Expert Meteorologists have issued Severe Wind Warnings for the whole of the North Island apart from Northland... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news