Farming and the Economy - Southland Times Column
Originally published as a column in The Southland Times
The contribution of farming to our economy has become more important than ever as Covid-19 decimates tourism and slows down Auckland.
Strong farm gate milk prices and increased Chinese demand for our logs has meant that the rural sector, in places like Southland, has continued to achieve strong export revenue, despite the current Delta challenges.
For a small country we punch well above our weight in terms of exports and as a nation feed ten times our population.
The rural sector has also shown resilience, despite challenges such as supply chain and food service disruptions, and the tight labour market.
At odds with this, some political parties seem determined to regulate farming out of existence, instead of working collaboratively with farmers to make science-based environmental decisions going forward.
But Covid-19 uncertainty reinforces the need for stable and predictable domestic regulation to avoid putting pressure on the rural sector whose exports are critical to the economy.
Last month Statistics NZ highlighted an almost 10 percent increase in the value of exports from our country – and this was a new high.
Goods exported grew by $1.4 billion - mainly due to key commodities - milk powder, butter, and cheese, logs and wood, meat and mechanical machinery.
Of those commodities, dairy products, and logs and wood, have shown consistent growth since the June 2020 quarter lockdown.
While Beef +Lamb NZ forecast New Zealand's receipts from exporting red meat will be about $8 billion, slightly down on 2020-21, while lamb export receipts are forecast to increase by 2.2 per cent on 2020-21.
Our farmers should be celebrated, holding their heads high for the wonderful economic contribution that they make – instead this Government continues to vilify them.
And all this despite a Ministry for Primary Industries Situation and Outlook for Primary Industries in June reinforcing that farming is the driving force behind New Zealand’s economic recovery.
It goes on to forecast that export revenue for our food and fibre sectors is set to hit a record high of $49.1 billion in the year to June 2022, driven mostly by strong demand for our dairy, forestry, and horticulture products.
Further to that, sustained growth is forecast year on year, hitting a further record of $53.1 billion for the year to June 2025.
However, increased Government emphasis on environmental considerations, such as carbon emissions, threaten to constrain further growth in agricultural output.
Our farmers are already extremely environmentally efficient in a world-wide sense.
However, as Federated Farmers points out, unless there are significant science breakthroughs – further reductions in farming’s greenhouse gas emissions are only going to come at the cost of production and profitability.
Now, as Covid-19 uncertainty reinforces the need for stable and predictable domestic regulation, the question must be asked is this the time to put pressure on the farming sector whose exports are so critical to our economy at this time.
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