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RNZ News
23-05-2025
- Business
- RNZ News
Trade surplus hits historic $1.4b high amid soaring primary exports
Photo: 123rf Despite sluggish global economic growth, New Zealand's primary sector exports are bucking the trend - recording its highest monthly trade surplus since 1960. Stats NZ reported that the merchandise trade surplus reached $1.4 billion in April, a dramatic turnaround from a $12 million deficit in the same month last year and only the fifth time New Zealand has surpassed the billion-dollar mark in trade balance. "New Zealand has had only four monthly surpluses over $1 billion. The last two were in 2020 and two out of the four were also in April months," said Stats NZ spokesperson Viki Ward. The overlap of the dairy and fruit industry seasons contributed to the high, she added. Milk powder was the largest contributor to exports last month, reaching a billion dollars, an increase of 32 percent compared with April 2024. Fruit was up from $265m to $1.2b. New Zealand Apple & Pears chief executive Karen Morrish said excellent weather and an early harvest were big factors. "It's very much the sentiment out there at the moment that the 2025 growing season is one of the best years on record. So we were able to start harvest early, the fruit was in excellent condition, the size was good. "It meant that packouts through the pack house were good and we could take advantage of those early markets as well. All of those things combined has given that considerable push in the volumes and, hopefully, the eventual price." The Wood Processors and Manufacturers Association (WPMA) said a concerted effort by processors and forestry to work together is paying off, following a 42 percent increase in exports of logs, wood, and wood articles year-on-year. Chief executive Mark Ross said the $141m increase was "reasonably significant" and a welcome surprise. "Members say that it's a pretty tough export market out there. So seeing this figure and the result, there's actually really pleasing, and it's also encouraging - because the sector has been doing it tough. Ross said it had been working hard to get more value-added wood products versus logs exported, and that remained the goal and strategy going forward. The demand for sustainable products was huge, he said, with New Zealand wood exporters well-placed to benefit. "We've got a great story to tell, around our sustainable forestry systems and the ability to trace our logs to harvest. "It's really looked upon well by overseas exporters along with the quality of our products so we can supply clear timber and high-quality, value-added products. "They're really well received around the world when it comes to building, construction and other uses." Both Ross and Morrish said it was too early to tell how the US tariffs would affect the next year. New Zealand timber and lumber exports to the US were currently exempt from the 10 percent additional tariff, but that was temporary and under review. Exports to China picked up in the past year but the tariffs war could change that, Ross added. Morrish said times were "certainly turbulent" but there was still strong demand for NZ products, particularly in traditional markets, and when it came to tariffs it was "very much wait and see". "If it isn't tariffs it's shipping. If it isn't shipping, it's something else. "So with that diversification of markets, that's where our exporters are very nimble, and being able to react and move appropriately and accordingly to try and weather those storms a little better. "But it is one of those things where everybody's got intel on the ground and they're leveraging off those relationships to make sure that they make the right decision at the right time. Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Scoop
22-05-2025
- Business
- Scoop
'Investment Boost' Announced In Budget 2025 Welcomed By Wood Processors And Manufacturers
22 May 2025 From the 22 May 2025 a new tax incentive, 'Investment Boost', that allows businesses to immediately deduct 20% of the costs of new assets (or second-hand assets purchased from overseas) – such as machinery, equipment, tools and buildings – from taxable income on top of the existing depreciation write-offs is welcomed by the Wood Processors and Manufacturers Association (WPMA). Noting that the new regime can also be applied to investments that were started before the 22 May, if they are available for use the first time after that date. For example, if a mill invested $500,000 in new timber machinery, $100,000 would be immediately deductible. The remaining $400,000 would be depreciated as normal. There is no cap on this allowance which is also welcome. The announcement was made as part of Budget 2025, with the scheme allowing wood processing and manufacturing businesses to deduct a higher percentage of the cost of eligible assets in the first year of purchase, reducing their tax burden and freeing up capital for further investment. 'Enabling capital investment for new manufacturing technologies and equipment, such as cutting-edge timber machinery and equipment, within the wood processing industry to deduct 20% of the costs of the new asset immediately will provide an added incentive for investment and increased productivity in a sector where government backing is needed' said Mark Ross, WPMA Chief Executive. "It is hoped that this new tax rule will assist in encouraging further investment in value-added wood processing production within New Zealand", said Ross, increased domestic wood processing will not only provide economic growth in our regions, but will also assist in providing increased sustainable wood fibre production as a pathway to meet our Paris Agreement climate change targets.
