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A strong export performance and farm profitability results, despite a variety of challenges, is testament to the resilience of farmers, the Ministry for Primary Industries’ latest Situation and Outlook for Primary Industries report says.
That resilience provided confidence farmers would be able to adapt to future disruptions such as climate change, adverse events or potential trade issues.
It was also reflected in MPI’s medium-term outlook for annual export growth to range between 1.2% to 2.6% between 2019 and 2022.
Primary sector exports are forecast to exceed $46 billion by the end of the outlook period.
Production and export volumes were forecast to be relatively stable, particularly in dairy and meat and wool.
Dairy cattle numbers had fallen by more than 200,000 since 2014 and sheep and beef land was expected to continue declining. Primary industry exports were forecast to be up 11.8% in the year ending June 2018 to $42.6 billion.
That export performance was reflected in rising on-farm profitability. All primary industry sectors were contributing to the $4.5 billion increase for the previous year, led by double-digit percentage growth in the three largest export sectors.
Dairy sector export revenue was on pace to increase by 13.6% in the year ending June to $16.6 billion, with higher prices offsetting slightly lower production volume.
The meat and wool sector was on track to strongly rebound from lower export revenue in 2017, led by higher lamb and mutton prices.
Total meat and wool export revenue was forecast to have expanded by 12.4% to $9.4 billion in the year ended June 2018.
Forestry export revenue was forecast to expand by 15.8% this year, due to record harvest volumes and log prices, driven by strong Chinese demand for logs.
Mycoplasma bovis had been a significant challenge for affected communities and individuals. In addition, a wet spring and dry summer disrupted production in some regions.