MINISTRY SHAKEUP 38 FEBRUARY 2018 STATE OF THE PRIMARY INDUSTRY NATION New Zealand’s primary industry exports are impressive and provide the sector with a strong base to deal with the challenges ahead, says Agriculture Minister Damien O’Connor. The sector is expected to grow by 8.5% this year to $41b, the largest annual increase since 2014 when dairy prices rose to very high levels, and will be spread across all sectors on a more sustainable foundation. In the latest Situation and Outlook for Primary Industries report, dairy exports are leading the way, with a forecast increase of 15% to $16.8b this year in the face of a wet spring affecting production. Despite a decline in cow numbers, there has been some better value for exporters. The sector continues to provide a solid base for a better future. Meat and wool exports are forecast to grow 4.2%to $8.7b, with lamb prices looking good and beef, mutton, and venison also doing well. New Zealand’s primary industries are evolving. Our horticulture sectors are leading the charge in producing high-value products tailored to target markets overseas. This isn’t just true for kiwifruit, wine and apples - there are also emerging opportunities for cherries, avocados and berries. We are also seeing a huge shift to high-value products in the dairy sector. For example, infant formula exports are forecast to exceed $1b in 2018 for the first time. UHT milk, yoghurt and other specialty products are also doing very well. We are a primary producing nation and it is very encouraging that the prospects for the primary industries look so bright. However, New Zealand and other primary producing nations face the global challenge of sustainability – we need to provide good quality, nutritious food for a rapidly rising global population but we must do this in a way that is sustainable. This means placing an even greater focus on high-value production, sustainable resource use, managing the risks posed to our primary sector by harmful pests and diseases, and meeting ever changing consumer demands. The news is also good for other sectors. Horticulture exports are forecast to grow 5.2% in 2018 with broad-based growth across the sector. Wine, kiwifruit and pipfruit are all contributing to this growth story, and there is a high level of investment supporting further growth. Rising prices for wild capture fisheries products and aquaculture volumes are expected to contribute to a 4.4% increase in seafood exports to $1.8b. Honey export volumes are forecast to resume growth after a dip in 2017, while exports of innovative processed foods, including dietary supplements products, are expected to resume their growth. The Situation and Outlook report is available on the MPI website at: https://tinyurl.com/primaryindustries New Zealand’s government will this year set up four portfolio based entities - Fisheries New Zealand, Forestry New Zealand, Biosecurity New Zealand and New Zealand Food Safety. Minister Damien O’Connor has announced that the Ministry for Primary Industries (MPI) will reorganise its functions to create a stronger focus on core responsibilities. “Our priority is to achieve greater clarity and unity of purpose for these areas,” he says. “We are seeking enhanced visibility of government policy and regulatory activities and clearer lines of accountability and engagement for stakeholders. We are now looking to the Director General of MPI to work with his team to achieve this, while ensuring prudent and efficient use of taxpayer and industry funds. MPI will continue to meet the expectations of our international trading partners as the competent authority.’’ Reorganisation of MPI’s functions will occur in the early part of this year and will be in place by April. “This change is about increasing focus and ensuring greater visibility of fisheries, forestry, biosecurity and food safety.” The estimated cost to implement the changes is $6.8 million to establish the four portfolio-based business units, with additional ongoing operating costs of $2.3m per annum. O’Connor says reprioritised money from the Primary Growth Partnership Fund will pay for the changes. MY SAY
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