Dairy's role in sustaining New Zealand - Fonterra

More documents

Recommendations

Info

16 Dairy’s role in generating growth The increased production in dairy draws in more labour, which is shown by the rise in employment. Note however that, in our modelling, employment is assumed to vary much more quickly than wages. In the short timeframe of this simulation we would not expect to see much impact on wages because they have not had time to adjust. Similarly, while the rate of return on dairy capital has risen, the level of capital in the industry has not yet had time to accumulate. Table 6 National results Real percentage deviation from BAU levels Indicator Percentage change Levels change, $ millions GDP 0.24% $400 Private Consumption 1.2% $1,200 Public Consumption 1.2% $360 Exports (volume) -1.8% -$1,000 Imports (volume) 1.4% $720 Employment 0.35% 4,600 FTEs Hospitals Government 1.3% Police Government 0.8% Apple and Pear Competing export -3.0% Sheep and Beef Competing export -0.4% Textiles Competing export -1.3% Source: NZIER 3.2.4 Regional impacts The impact on the districts is in proportion to the importance of the dairy industry to the region. The majority of New Zealand’s dairying is in the central North Island and that is reflected in the strong growth of Taranaki, Waikato and the Manawatu. However, dairy is also very important to the small Northland economy, which is why the large gains are seen there. Districts that have strong red meat industries, such as Canterbury, suffer due to the competition for resources from the growing dairy sector in this simulation. Similarly, districts that depend on exports, such as Tasman’s wine and Auckland’s manufacturing, see low growth due to the costs imposed by the appreciation of the exchange rate. The impacts of a $1/kg price increase on per person consumption or living standards in each region are shown in Table 7.
Figure 7 Gross regional product impacts Real Figure percentage 7 Gross deviation regional from BAU product levels impacts Real percentage deviation from BAU levels Source: NZIER Source: NZIER Table 7 Increase in gross regional product Table 7 Increase in gross regional product Region Northland $170 Per person increase in GRP Northland Auckland -$4 $170 Auckland Waikato $130 -$4 Waikato Bay Of Plenty Bay Of Plenty Gisborne Gisborne $66 $100 $130 $66 $100 Hawkes Bay Hawkes Bay $39 $39 Taranaki Taranaki $160 $160 Manawatu-Wanganui $140 $140 Wellington $140 $140 Tasman-Nelson $12 $12 Marlborough $54 $54 West West Coast Coast $69 $69 Canterbury Canterbury $41 $41 Otago Otago Southland Southland Source: NZIER Source: NZIER $82 $68 $82 $68 NZIER – Dairy’s role in generating growth Region Per person increase in GRP Final report - 16 November 2010 Dairy’s role in generating 19 growth 17
Page 1 and 2: Dairy’s role in sustaining New Ze
Page 3 and 4: Key points Dairy makes a very stron
Page 5 and 6: It drives many rural economies: “
Page 7 and 8: Contents 1. The current contributio
Page 9 and 10: 1. The current contribution of dair
Page 11 and 12: Table 2 Export values $ millions, 2
Page 13 and 14: Figure 3 Importance of dairy to reg
Page 15 and 16: Table 3 Farming industry structure
Page 17 and 18: 2. Modelling dairy’s economic con
Page 19 and 20: Figure 5 Change in milk solids pric
Page 21 and 22: 3. Milk solids price spike 3.1 Head
Page 23: Table 5 Indirect impacts 2010 Perce
Page 27 and 28: 4. Production growth over the last
Page 29 and 30: Table 9 Indirect impacts 2008/09 Pe
Page 31 and 32: Figure 9 2009 Gross regional produc
Page 33 and 34: Appendix A CGE modelling framework
Page 35 and 36: Figure 11 The MONASH-NZ database Fi
Page 37 and 38: At the activity level, intermediate
Page 39 and 40: Table 12 IO vs. CGE multipliers Mul
Page 41 and 42: Appendix D References Bandara, J. S
Page 43 and 44: Farming Milk & cream Ice cream Chee
Page 45 and 46: Farming Milk & cream Ice cream Chee
Page 47: Appendix G Changing dairy export ma

Dairy's role in sustaining New Zealand - Fonterra

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?