Meat export prices hit record high

Export prices for meat, including beef and lamb, rose to their highest-ever level in the December 2019 quarter, boosting overall export prices, Stats NZ said today.

"Meat export prices have risen for three quarters in a row, on the back of strong demand towards the end of last year," business prices manager Bryan Downes said.

Meat volumes rose 3.2 percent, and values rose 12 percent in the December 2019 quarter.

"Over the year, meat prices also rose, with both beef and lamb prices up," Mr Downes said.

See Meaty increases push up annual food prices for more detail.

Wood export prices also rose in the December 2019 quarter, up 8.2 percent, partly recovering from falls in the previous two quarters.

"Exports of meat and logs increased towards the end of 2019, before the outbreak of coronavirus in China," Mr Downes said.

China is New Zealand's biggest trading partner.

"Any impact of the coronavirus on prices for our goods and services, mainly because of disruptions to global trade, could be reflected in the March 2020 quarter," Mr Downes said.

Partly offsetting the rise in meat and wood export prices was a 2.4 percent fall in dairy prices. While volumes were up 14 percent, the value of dairy exports rose by only 11 percent. The fall in dairy prices was driven by an 11 percent fall in butter prices in the latest quarter. However, butter prices remain at historically high levels following strong price increases a few years ago.

Overall, export prices rose 3.0 percent in the December 2019 quarter.

Import prices rose at a lower rate (up 0.3 percent) with increases to imported vehicles partly offset by falls to crude oil and cell phones.

Terms of trade at record level

The merchandise terms of trade rose 2.6 percent to its highest level, as export prices rose more than import prices. The terms of trade is a measure of the purchasing power of New Zealand's exports abroad. An increase means New Zealand can buy more imports for the same amount of exports.