The forecast gain "is due to high dairy prices and an increase in production more than offsetting the expected high exchange rate."
New Zealand dairy exports will rebound in the coming year as production picks up and prices rise, the Ministry for Primary Industries said.
Dairy export revenues will grow 8.1 percent to NZ$13.9 billion ($11 billion) in the year through June 2014 after dropping 5.5 percent in the previous 12-month period, the ministry said in its semi-annual forecasts published in Wellington today.
The forecast gain "is due to high dairy prices and an increase in production more than offsetting the expected high exchange rate," the ministry said. "Looking further out to the year ending 30 June 2017, export revenue is forecast to reach NZ$17.7 billion as a result of an expected rise in domestic production, increasing international dairy prices and a depreciating New Zealand dollar."
New Zealand is the world’s biggest exporter of dairy products. Sales were hit by the higher exchange rate and a summer drought which will curb milk production by 1.2 percent in the current year, the ministry said. Milk output is forecast to rise 4.5 percent in 2013-14.