Optimism On The Horizon For New Zealand Exporters, But Increasing Costs Remain Challenging

Auckland, New Zealand, 25 September 2024: The 2024 ExportNZ DHL Export Barometer, released today, indicates optimism is on the horizon for New Zealand exporters despite challenging economic conditions over the past year. However, increases to both overall operational costs to businesses as well as supply chain and logistics costs remain a key pressure point.

The report reveals more than half (58%) of New Zealand-based exporters expect their overseas orders to increase in 2025. This is a significant increase from last year, when only 42% of exporters experienced growth.

However, almost nine out of ten (89%) exporters are carrying more costs in their business than they were a year ago. While delays and costs have not reached the same levels as they did in 2021 and 2022, the top barriers for exporters continue to be cost and supply of supply chains and logistics (55%), the high cost of doing business in New Zealand (44%), and the value of the New Zealand dollar (27%).

Selina Deadman, Vice President, Commercial at DHL Express New Zealand said the results are encouraging. “While costs remain an issue, it’s comforting to see signs of optimism on the horizon with more than half of these exporters expecting an uptick in overseas orders within the year. The research highlights that 83% of New Zealand-based exporters are experiencing up to a 49% increase in costs.

“In another encouraging sign, Kiwi exporters are exploring new strategic avenues to tackle challenges, including developing new products and services, improving processes to drive productivity, and entering new international markets. To equip exporters with the knowledge and expertise needed to navigate the global marketplace, we’ve developed a comprehensive suite of digital solutions such as My Global Trade Services (myGTS), which helps exporters strategise on where to do business, and On Demand Delivery (ODD) which empowers both the shipper and the recipient to customise their delivery preferences,” says Deadman.

As in previous years, Australia (77%), US (52%) and Continental Europe (46%) were the markets most popular for exporters. However, this year’s Export Barometer highlights a larger range of export markets – 4.6 markets compared to 4.2 in 2023. This is partly the result of more exporters selling into the EU and the UK, following the completion of New Zealand’s Free Trade agreement with those economies.

Joshua Tan, ExportNZ Executive Director praises the industry’s response to the volatile economic and exporting environment.

“The current operating environment is difficult to navigate, with persistent challenges connected with the rising cost of doing business. Despite the many challenges, exporters have expressed optimism and confidence in future growth through the survey, which is very encouraging.

“Given the Government’s goal to double export value within ten years, there are areas where Government support would be valued by exporters – support to help them grow their businesses here in New Zealand and leverage market opportunities overseas. The results from the survey reflect ongoing concerns and potential growth areas that are well known to both the Government and the sector, so now is the time to implement meaningful action,” says Tan.

Exporters continue to express optimism despite the current tough economic conditions, and are prepared to meet further challenges over the next year, in the hope that cost and delay difficulties ease and the global trading environment improves.

About the ExportNZ DHL Export Barometer

A joint initiative between ExportNZ and DHL, a total of 271 New Zealand exporters were surveyed for the ExportNZ DHL Export Barometer 2024. The ExportNZ DHL Export Barometer is an initiative aimed at analysing export confidence in New Zealand and identifying export trends. It is based on nationwide research, examining the business outlook of exporters, highlighting changes in overseas market demand and providing insights into the factors impacting on New Zealand’s export trade.

The research was conducted between 01 June and 30 June 2024. The profile of respondents included representatives from all areas of the country, with Auckland representing 40%, Wellington 14%, Rest of the North Island 25%, Canterbury 15% and Rest of South Island 7%. They comprise a range of business sizes with 30% either sole traders or having 2-4 employees, 26% classed as small businesses (5-19 people), 30% medium (20-99 people) and 14% as large businesses (100+ employees).

The key industry segments targeted are: Manufacturing (39%), Online Retail (9%), Professional Scientific & Technical Equipment (6%) and Agriculture, Forestry & Fishing (9%).

While the majority of respondents comprise businesses that have been exporting for more than 20 years (49%), 23% have been exporting for 11-20 years, 13% have been exporting for 6-10 years and 15% have been exporting for five years or less.

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