Dollar pushing manufacturers overseas

Last updated 15:00 11/09/2012

Relevant offers


Charges laid in US over India-based phone scam won't stem tide for Kiwis - NetSafe Friends-themed cafe in Singapore causes outrage with $1000 membership The young Kiwis making millions Edendale milk silo collapse cost set to hit $45 million - Mercer Money tool for the blind released by Reserve Bank Software from failed firm Wynyard underpins sex offender register and major police investigations The Warehouse swings pose risk of 'serious injury' Qantas ratchets up excess baggage fees by 75 per cent Instagram star Kayla Itsines is worth a whopping A$46 million Police vetting checks criticised by privacy commissioner

New Zealand manufacturers would likely look to moving off shore if the kiwi dollar reaches a predicted US90c.

Currency trader Nick McDonald has reportedly predicted the kiwi dollar would beat its post-float record of US88.43c in the next year to 18 months.

John Cook, managing director of Stainless Design in Hamilton, said a hike from today's US81.03c would be bad news for the New Zealand economy.

"Manufacturing businesses will look offshore for cheaper solutions," Cook said. "The good news from our perspective is that China is not the super low cost base that it was and distance and time to market is still an issue."

Cook said his company, 80 per cent of whose stainless steel products were exported, was committed to remaining in Hamilton but he knew of overseas businesses who were constantly chasing the lowest manufacturing cost and were now manufacturing in Vietnam and India.

Owen Embling, managing director of Hamilton packaging maker Convex Plastics, was expecting the rise to US90c and was worried about what such a hike would do to the export sector.

"It will mess up our export sector most definitely," Embling said. "It will make it impossible. I have got customers now who find it hard. If it is going to US90c they are definitely going to be making alternative arrangements."

Sam Lewis, chairman of Hamilton based Affco meat exporter, said there was only one word to describe the kiwi reaching US90c.

"Disastrous," he said. "For farmers it's disastrous and it's disastrous for the economy. We can't do much about it."

Such a climb would have a considerable impact on the meat schedule and dairy payout.

Fonterra refused to comment, but such a rise could shave about 50 cents of the payout.

Ad Feedback

- Waikato

Special offers

Featured Promotions

Sponsored Content