Kiwi exporters reveal their biggest wishes as tricky web of inflation, Covid hangover lingers

Exporters are still battling lingering challenges linked to migration, inflation, and re-engaging with the world after lockdowns and border closures. Photo / Getty Images

Politicians hoping to win the votes of exporters would be well-advised to get them on a plane and off to a good trade fair.

Support for attending trade shows and the accompanying chance to make new contacts was a big desire for respondents in the latest ExportNZ DHL Export Barometer.

That’s not just a reflection of a desire to have adventures or junkets. Nearly one-third of respondents said support for attending trade shows would be very important as exporters re-engaged with the world after Covid-19.

The survey arrived at an unusual time, as exporters are contending with the end of border closures but still feeling some impacts of pandemic-era supply chain logjams.

Globally, China’s economic rebound has been sluggish and the giant economy faces an ageing population, deflation and high youth unemployment.

And just next week, a huge trade delegation will leave New Zealand for India, which recently became the world’s most populous country but has long evaded the overtures of Kiwis keen for a free trade deal.

Upcoming trade fairs of possible interest to exporters include WorldFood Istanbul from September 6 to 9, billed as the largest food sector exhibition in Eurasia.

The car industry’s Automechanika is scheduled in Johannesburg from September 5 to 7, and London’s Speciality & Fine Food Fair is on September 11 and 12.

The World Ag Expo will be held in Tulare, California from February 13-15 next year, and ProWein for the wine and spirits sector takes place from March 10 to 12 in Dusseldorf.

After trade show support, the next priority, or most desired policy, for exporters surveyed was for more free trade agreements with new partners.

Migration and skills

After that, a better immigration system was cited as a major exporter priority.

Border closures shut many migrants out from early 2020 to the middle of last year, by which time a serious local labour shortage had emerged.

And one-quarter of all respondents said they were still struggling with labour shortages.

The ExportNZ DHL Export Barometer said the business environment at home and abroad was still tricky to navigate for New Zealand exporters.

Among the 250 New Zealand exporters surveyed, increasing costs were a recurrent theme - and seen as a major barrier to exporting.

“While supply chains are easing around the world, the rise in interest rates and the upward pressure on costs of doing business and living has meant that exporters are certainly feeling the pressure at home,” the new report added.

“A staggering 90 per cent of respondents saw an increase in total costs, a number signalling that our export sector may struggle in the near future with cashflow issues.”

To manage these challenges, nearly half of exporters were carrying more stock or raw materials on-hand, and 40 per cent had changed logistics or shipping providers.

“Exporters continue to use their Kiwi ingenuity to grow their export sales, with over a third of respondents developing new products and services,” the report added.

But the ExportNZ-DHL report found optimism despite the many challenges.

The 2023 barometer found a third of respondents witnessed an increase in their export orders and more newcomers joined the exporting club - with 8 per cent of respondents new to exporting, compared to just 4 per cent a year ago.

But with challenges around the cost of exporting, 24 per cent of those surveyed had a decrease in their export orders and 37 per cent said their export orders just stayed the same.

“With export growth in 2024 remaining uncertain, Kiwi exporters are confident that they have planned well and they will see more of an increase in export orders, as opposed to what they have seen in the past 12 months.”

John Weekes is online business editor. He has covered courts, politics, crime and consumer affairs. He rejoined the Herald in 2020, previously working at Stuff and News Regional, Australia.