Director predicts farm exports drop

Press, 1 June 1989, Page 14

Director predicts farm exports drop

PA Auckland Drought and destocking will cost New Zealand $5OO million in lost agricultural export income next season, says the director of the Meat and Wool Boards’ economic service, Mr Neil Taylor. Mutton and beef slaughtering were predicted to decline 18 per cent next year, he told the meat and wool section of Bay of Plenty Federated Farmers in Tauranga. Wool production was estimated to be down 5 per cent and lamb production 11 per cent. “We have been through a very deep recession,” he said. “The production figures for next season are horrific.” About 23 million lambs would be killed compared with a high of 39 million earlier this decade. “Just over 300,000 tonnes of wool will be produced compared with 380,000 a few years ago,” Mr Taylor said.

“People talk about selling the Bank of New Zealand or State-owned enterprises, but we have sold a lot of stock which is just as valuable.” The process of restructuring the economy had made New Zealand more dependent on agriculture. It would earn 65 per cent of overseas income this season, the highest for a decade. Mr Taylor said there were some positive signs. Annual price improvements over the next five years were predicted to be 5 per cent for lamb and 8.4 per cent for beef. How quickly farmers could respond .to these price signals was being over-estimated. “Only half the fertiliser needed to retain present stock numbers is going on,” Mr Taylor said. “Lambing percentages and stocking rates are pretty disappointing.” Investment in farm development was only one-

third of what it was four years ago. “Real net farm incomes since 1984-1985 have remained at a level that is only 40 per cent of the average for the 19705,” he said. "These are disastrous figures.” A 1 per cent drop in interest rates would mean $35 million extra income for farmers or $1550 for each sheep and beef farm, Mr Taylor said.