Early Bird I Friday April 4th 2025

US tariffs create uncertainty for meat and dairy exporters, rain warnings issued across drought-hit regions, and second shear wool hold firm in declining North Island market.

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US tariffs create uncertainty for meat and dairy exporters

Primary sector exporters are carefully evaluating the impact of newly announced 10% US tariffs set to take effect from Saturday. The tariffs will affect a significant trade relationship, with NZ exporting $9 billion worth of goods to the US last year, up 9% on the previous year.

The United States has become New Zealand's largest market for red meat exports following China's recent weakness, with exports worth $2.7 billion in 2024. Beef accounted for $1.8 billion of that figure with 183,000 tonnes shipped, while sheepmeat exports to the US were valued at $625 million, making it our second-largest market by value.

Meat Industry Association chief executive Sirma Karapeeva acknowledges that while tariffs distort trade and reduce market efficiency, New Zealand exporters remain highly responsive to global market dynamics. With US beef herds at historically low levels and record domestic consumption, strong demand is still expected despite the new tariffs. Karapeeva notes that the measures may cause other exporting countries to redirect products to markets where New Zealand operates.

Fonterra is also working to understand the implications for its dairy exports, which are primarily value-added protein ingredients including caseins and whey protein concentrates. Simon Tucker, Fonterra's group director of global external affairs, emphasizes that the co-op has extensive experience navigating difficult trade environments and will continue to adapt.

 

Government working with exporters to navigate new US tariff reality

Meanwhile Trade Minister Todd McClay acknowledges the upcoming 10% US tariff is significant but emphasizes our exporters remain competitive against international rivals in American markets. The tariffs, taking effect this weekend, come as part of a broader US move that has hit many other countries with much higher rates.

McClay highlights that free-flowing trade best serves New Zealand's interests. He warns that tariffs ultimately impact the global economy through increased inflation, reduced demand, currency instability, and slower economic growth.

The Minister maintains that New Zealand's bilateral relationship with the US remains strong despite the tariff announcement. His office is actively seeking more information from the US Administration while consulting with exporters to better understand the specific impacts across different sectors.

McClay reaffirms New Zealand's commitment to advocating for a rules-based trading system as exporters prepare for the tariff implementation this weekend and adjust their strategies accordingly in what remains a crucial market for our primary sector.

Rain warnings issued across drought-hit regions

A massive atmospheric river weather system is bringing much-needed relief to drought-stricken areas with up to 400mm of rain expected to fall over the next day and a half. MetService has upgraded numerous weather watches to orange heavy rain warnings as the largest weather system of the year moves across the country.

The heaviest falls will hit northern regions first, with Northland currently under a warning that began at 10am yesterday and continues until 1pm today. 

Bay of Plenty and Gisborne should prepare for heavy downpours from 6am this morning with up to 160mm expected inland and about the ranges. The Coromandel Peninsula has been under warning since 1am t