2019: the year of the Sheep

Auspiciously, 2019 was the ‘Year of the Pig’. As it turns out though, African Swine Fever meant that pigs were few and far between this year. For NZ farmers, this meant that 2019 quickly turned into the ‘Year of the Sheep’, with sheepmeat prices reaching unprecedented levels. Beef prices also set fresh record highs, while fruit prices also boomed. With the milk price joining the party in the second half of the year, 2019 has generally been a stellar year for farmers on the commodity price front.

At the start of the year, it was a stretch to imagine lamb prices topping the record highs of spring 2018. But top them they did! In fact, spurred on by African Swine Fever, lamb prices hit as high as $9.00/kg this year. Beef prices weren’t far behind as they also surpassed the previous record highs.

Meanwhile, 2019 has been another banner year for fruit exports. After cracking $3 billion in exports for the first time over 2018, fruit exports are set for another leg up to around $3.4 billion over 2019. The kiwifruit sector or more precisely gold kiwifruit exports have been doing much of the fruit industry’s heavy lifting.

On the whole, 2019 has been a good year for the milk price. While the 2018/19 season delivered a modest $6.35/kg milk price, the second half of 2019 saw the milk price hit the ground running. Indeed, we end the year with a bullish $7.50/kg forecast for 2019/20 in place.

Turning to financial markets, 2019 has seen interest rates tumble to record lows. However, while we expect benchmark rates to remain very low, we may be past the absolute lows in lending or customer rates.

The NZ dollar has also been a ‘star’ over 2019. As seen in the chart below, the relatively weak NZ dollar has helped boost farmgate prices in NZD terms.

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Nick Tuffley

ASB Chief Economist

Since starting out in 1997 as an economist, it's fair to say Nick has seen a few hair-raising moments over the years, including the Asian Financial Crisis and the Global Financial Crisis.

One of Nick's strengths is his ability to communicate complex ideas in a readily understandable and entertaining way.  He thrives on helping people understand the economic environment to help enrich the quality of their business or personal life. He’s proud to lead a team that has won two Forecast Accuracy Awards from Consensus Economics, and has a strong track record with their Official Cash Rate and dairy price forecasts. 

Nick grew up in Christchurch and graduated with a Master of Commerce degree from the University of Canterbury.  He learned his economic ropes at the Reserve Bank of New Zealand before a long stint as a Senior Economist at Westpac, and joined ASB as Chief Economist in 2007.

Mark Smith

Senior Economist

Mark joined ASB in 2017, with over 20 years of public and private sector experience working as an economist in New Zealand and the UK.

His resume includes lengthy stints at ANZ and the Reserve Bank of New Zealand, and he has also worked at the Bank of England, HM Treasury and the New Zealand Transport Agency. Mark's areas of specialisation include interest rate strategy, macro-economic analysis and urban economics.

Born and bred in the Waikato, Mark studied at Waikato University where he graduated with a Master of Social Sciences, majoring in Economics.

Mark's key strengths are the ability to use his extensive experience, inquisitive nature, analytical ability, creativity and pragmatism to dig a little deeper and to deliver common sense solutions to tackle complex problems.

When not at work Mark likes to travel, keep fit and spend time with his friends and family.

Chris Tennent-Brown

ASB Wealth Senior Economist

Chris has worked as an economist for ASB and Commonwealth Bank of Australia in Sydney since 2005. His work has involved monitoring and forecasting trends in the New Zealand economy, with a focus on drawing implications for financial markets and investments. Chris is passionate about savings issues, and much of his current work is focussed on broadening peoples understanding of investments. Chris obtained a Bachelor of Commerce at Auckland University, majoring in Economics, and prior to joining ASB worked in the funds management industry for Bankers Trust and BT Funds Management. With over 20 years' experience in finance, Chris has also spent several years farming, and was a New Zealand representative cyclist. When not at work, Chris likes to travel, cycle, and spend time with his family and numerous pets.

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