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

 

El Nino weather pattern may dent NZ farm output: BNZ

El Nino weather pattern may dent NZ agricultural output, BNZ says, citing historic data

By Anna Lu

May 25 (BusinessDesk) - The El Nino weather pattern that meteorological forecasters are predicting this year is likely to reduce New Zealand's agricultural output, based on historic data, economists at Bank of New Zealand say.

Historic data compiled by BNZ suggests a positive co-relation between New Zealand’s agricultural growth and the Southern Oscillation Index, a standardised index of sea level pressure differences between Tahiti and Darwin that is used to determine whether El Nino or La Nina is present.

The index dropped below 15 in May, a level that indicates the coming of El Nino. The Australian Bureau of Meteorology confirmed this month that the Pacific Ocean has officially entered into an El Nino pattern that has a 70 percent chance to last through the southern winter and spring.

El Nino typically increases the likelihood of drought in the east of New Zealand as a result of the strong frequent winds it brings from the west and south west, BNZ said.

Coinciding with that in the past was the rise of livestock slaughter as dry conditions put pressure on the supply of feed. That also tends to restrict milk production growth in general, while not reversing the trend. Previous periods of El Nino have resulted in "modest declines in New Zealand's agriculture GDP."

However, BNZ remains cautious about giving any El Nino-affected price predictions given the amount of variables in the equation. Lamb prices did tend to drop under previous El Nino seasons, but other variables include supply from rival producers in Australia, inventory levels in export markets, and the exchange rate.

El Nino is typically followed by its La Nina opposite, which can also weigh on agricultural production, BNZ said.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Government: Delivering Lower Card Fees To Business

Commerce and Consumer Affairs Minister David Clark has today announced the Government’s next steps to reduce merchant service fees, that banks charge businesses when customers use a credit or debit card to pay, which is estimated to save New Zealand businesses ... More>>

SEEK NZ Employment Report: April 2021

OVERVIEW OF APRIL 2021: STATE OF THE NATION: April, for the second consecutive month, saw the highest number of jobs ever advertised on seek.co.nz. Applications per job ad fell 9% month-on-month (m/m). SEEK job ads were up by 12% m/m. SEEK job ads were ... More>>

Commerce Commission: Warns Genesis Over Business Billing Errors

The Commerce Commission has issued a warning to Genesis Energy Limited about billing errors concerning electricity line charges to business customers. Genesis reported the errors to the Commission. The Commission considers that Genesis is likely to ... More>>

Stats: Lower Job Security Linked To Lower Life Satisfaction

People who feel their employment is insecure are more likely than other employed people to rate their overall life satisfaction poorly, Stats NZ said today. New survey data from the March 2021 quarter shows that 26 percent of employed people who thought ... More>>

The Conversation: The Outlook For Coral Reefs Remains Grim Unless We Cut Emissions Fast — New Research

A study of 183 coral reefs worldwide quantified the impacts of ocean warming and acidification on reef growth rates. Even under the lowest emissions scenarios, the future of reefs is not bright. More>>

The Conversation: Why Now Would Be A Good Time For The Reserve Bank Of New Zealand To Publish Stress Test Results For Individual Banks

Set against the backdrop of an economy healing from 2020’s annus horribilis , this week’s Financial Stability Report (FSR) from the Reserve Bank (RBNZ) was cautiously reassuring: the country’s financial system is sound, though vulnerabilities remain. More>>