Farmers lead $72b exports charge

NEIL RATLEY
Last updated 05:00 10/05/2014

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Southland farmers will help sow the seeds allowing New Zealand agricultural export earnings to double in the next 10 years, the prime minister says.

John Key told farmers and industry representatives at the Federated Farmers Southland annual meeting yesterday total agricultural earnings were targeted to rise from $36 billion to $72b by 2025.

Southland farmers would play a significant role in delivering the growth, Key said.

He took up an invitation from Federated Farmers Southland to speak at the meeting while he was in Invercargill to officially open ILT Stadium Southland.

About 200 farmers and industry representatives attended the meeting at SIT Velodrome in Invercargill.

The crowd was told next week's budget looked strong and the agriculture sector had been the backbone of the economy.

"Dairy products, despite being down 20 per cent from their high, are in high demand in Asia," Key said.

Dairy prices were pulling back a little bit because of extra supply, mainly from Europe, but this would be temporary Key told the crowd.

"Overall, the demand curve is looking really strong," the prime minister said.

The Chinese market was continuing to grow under National, he said.

"When I first became prime minister there was $8 billion worth of two-way trade between New Zealand and China. We sold them $2 billion worth of products and we bought $6 billion worth."

Today two-way trade was worth $20 billion, with New Zealand selling China $12 billion and by 2020 China wanted that two-way trade to reach $30 billion, Key said.

Dairy products alone had leapt from $500 million five years ago to $5 billion today.

"New Zealand is China's largest supplier of infant baby formula," he said.

The Chinese had also gone from "nowhere" to becoming New Zealand's largest sheepmeat purchaser.

New Zealand's agriculture sector was in a strong position but to continue to meet demand and drive export growth, the sector needed to embrace science, Key said.

"This is happening in the red meat sector and the highly automated processing sector."

The number of sheep in New Zealand had halved since 1975 but science had allowed the same amount of lamb meat to be produced.

"The days of the big workforce in New Zealand freezing works over," Key said.

There was a massive capacity to expand agriculture production but environmental issue would have to be confronted.

Intense dairy farming posed issues around water ways but farmers were environmentalists and by working with regional authorities, solutions could be found, Key said. 

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