Agribusiness and Trade: NZ food and fibre sector poised for growth - Todd McClay

Agriculture, Forestry and Trade Minister Todd McClay. Photo / Maryana Garcia

New Zealand’s food and fibre sector is world-class. However, the world is not standing still. The next decade will be defined by who steps up, scales up, and captures value in an increasingly competitive global market. This is the decade to lead, not by default, but by design and New Zealand farmers and exporters are up for the challenge.

Our agribusinesses already deliver nearly $60 billion in export earnings, support 360,000 jobs, and underpin our global reputation for premium, safe, sustainable production. However, the opportunity ahead of us is greater still. As global demand rises and technology evolves, the question is not whether New Zealand can compete, but whether we will be ambitious enough to continue to lead the pack.

The future of our economy will be built on both value and volume, and no sector is better positioned to drive that growth than food and fibre. But staying ahead of the curve will take urgency, investment, and relentless execution. That means being more productive, more innovative, and more connected to the markets that matter as we find smarter and more cost-effective ways to meet environmental and climate obligations.

The Government’s goal is clear: to double the value of New Zealand’s exports in 10 years. That challenge starts at the grassroots and we’re backing the sector to seize it by unlocking productivity, accelerating innovation, and clearing the regulatory and capital bottlenecks that have stifled growth for too long.

Confidence rebuilding on the farm

In the past, over-regulation, compliance creep and anti-farming rhetoric eroded trust and stalled investment in our primary sector. But the settings are changing, and so is sentiment.

According to the February Federated Farmers Confidence Survey, general farmer confidence has rebounded by 16 points since July 2023. While there’s still work to do, this is the largest uplift in confidence in five years, and I predict the next survey, due in the coming weeks, will break new records as farmers reap the benefits of their hard work. The message is clear: this Government backs farmers and the policy reset is working.

Over the six years of the previous government, the rural sector was burdened by unworkable regulations that siffled production and stopped them competing on the world stage. Farmers and growers want to innovate and lead the world. They know they must be at the forefront of market trends to command shelf space in the world’s supermarkets and the attention of increasingly discerning consumers, and when given permission to compete they produce some of the most effect, high-quality, safe food and fibre the world has seen.

To ensure the farmers and growers can achieve this this we’ve reset rules, wound back costly red tape regulation, and reinstated common sense so producers have the freedom to do what they do best – grow food.

The focus is now firmly on moving forward. We’re looking at how we can increase land use flexibility to ensure farmers can adapt and diversify based on opportunity, not red tape. And we’re driving a full overhaul of the Resource Management Act to create a regulatory system that enables, rather than obstructs enterprise. One that recognises food and fibre as a strategic and economic asset, and allows us to smartly meet environmental obligations rather than closing down good businesses.

At the same time, we’re building long-term investment partnerships with the sector. In Budget 2025, we launched the Primary Sector Growth Fund (PSGF), a $246 million commitment to co-invest in high-impact innovation. The first project, Resilient Pastures, is already underway: a seven-year, $17 million programme to breed more productive, climate-tolerant pasture systems.

This is just the start. Upcoming PSGF projects will focus on automation, breeding gains in livestock and plants, and new platform technologies to give producers the tools to compete and win.

We also introduced Investment Boost, allowing agribusinesses to immediately deduct 20% of the cost of new assets from their tax bill, giving firms more capital to reinvest at speed, and to help drive economic growth and export opportunities.

Trade delivering – sharing our food and fibre with the world

As we reset the domestic policy environment, we’ve also been relentlessly focused on unlocking global opportunities for New Zealand’s world-class producers and exporters.

May marked one year since the EU Free Trade Agreement came into force—well ahead of schedule, and already it’s delivering. In just 12 months, exports have increased by more than $1 billion. Similarly, we’ve also marked two years of the UK FTA, which has seen a 21% boost in exports worth an additional $644.4 million.

Beyond Europe, we’ve signed a Free Trade Agreement with the United Arab Emirates which once enacted will unlock over $1 billion in additional trade value.

We’ve also concluded negotiations with the Gulf Cooperation Council (GCC), a high-potential $3 trillion regional economy, and launched negotiations with India, recognising its critical importance as a long-term growth market for New Zealand’s exporters.

Trade is not magical, it merely creates jobs and lifts incomes for every New Zealander.

Todd McClay

In Asia, we’re progressing an upgraded Services Agreement with China, and successfully resolved a long-standing non-tariff barrier in the cosmetics sector, unlocking an estimated $200 million in new market access for Kiwi exporters.

Importantly, we’re tackling non-tariff barriers (NTB) head-on. In the past 18 months alone, we’ve resolved $933 million worth of NTBs that were holding exporters back, including forcing Canada to honour its obligation to New Zealand dairy farmers under the CPTPP agreement - and we’re going after more.

This is trade policy focused on execution and growth. These outcomes are expanding shelf space, lifting export value, and reinforcing New Zealand’s competitive edge in a global market that demands quality, trust and speed. Trade is not magical, it merely creates jobs and lifts incomes for every New Zealander.

Global markets demand proof, not just promises

Premium markets increasingly demand not just great products, but verifiable systems behind them. That’s why we’ve launched New Zealand’s first Grass-Fed certification standard, giving red meat and dairy exporters a trusted mark to differentiate in global markets where sourcing claims are under the microscope.

Initiatives like this reinforce what the best in the industry are already doing. From leading grass-fed systems to precision technology and value-added processing --New Zealand agribusiness is already creating the future. Government’s role is to support, enable, and amplify that progress, clear the roadblocks, and scale the success.

The challenge is set and accepted

New Zealand’s position in the global food economy relies on dedication and relentless ambition focused on innovation that leads the world and keeps New Zealand forefront in the minds of global consumers.

There is no shortage of ability on our shores or desire to succeed. The demand is there, and the capability exists. What’s needed now is ambition backed by smart rules, better investment pathways, and a clear strategic direction, led by a sector that’s hungry to remain on the top shelf.