Bright forecast for primary industries

Rerewhakaaitu dairy farmer Mac Pacey said he was optimistic that dairy prices would gradually increase. Photo/Ben Fraser

Local farmers say they are feeling optimistic about the future of the primary industries.

In a statement released yesterday, the Ministry for Primary Industries said the outlook for New Zealand's primary industries was positive, with strong growth forecast across most sectors, and dairy prices expected to gradually increase over the next two years.

Rerewhakaaitu dairy farmer Mac Pacey said he was optimistic that dairy prices would gradually increase, though how quickly he was not sure - "the quicker the better".

"I don't think it can get any worse, I think we've hit the bottom of where we are."

It had been a "pretty good" season to date, and the second best season on his farm, Mr Pacey said.

"Most people have got good quality feed out here and cows in good health."

He said in September, when the cashflows got pretty tired, it would be tough for the young farmers.

Local drystock farmer Neil Heather said as long as the dollar stayed at a reasonable level he was pretty positive about the next couple of years. Mr Heather said the only thing was that in a lot of areas it was hard to grow your business because of environmental constraints coming in.

"But overall I'm pretty positive and I think the inflation rate for drystock farming has gone down."

In his area, grass growth, beef prices and wool prices were a lot better than other years, he said.

"Winter's been reasonably good to us so far this year."

MPI director of sector policy Jarred Mair said the latest Situation and Outlook for Primary Industries report showed that, overall, exports had returned to growth this year.

"New Zealand primary industry export revenue is estimated to reach over $36.7 billion in the year ending June 2016, supported by strong growth in horticulture and other primary sector exports and foods," he said.

"Free trade agreements will also help grow our exports, while population growth and economic development throughout Asia will support increased demand for New Zealand's protein, horticulture, wood and fibre products."

Primary industry sectors:

-Seafood.

-Arable.

-Dairy.

-Meat and wool.

-Forestry.

-Horticulture.

-Other primary sector exports and foods.

Facts and figures:

-Four out of seven sectors grew more than 10 per cent in the past year (annual figures are for the year ended June).

-Forecast total primary industry export earnings 2016, $36.7 billion, 3 per cent increase.

-Forecast total primary industry export earnings 2020, $43.9 billion, 20 per cent increase.