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Manufacturing

New Zealand's manufacturing industries make an important contribution to the national economy. In the year ended September 2015, manufacturing sector output accounted for around 10% of real GDP. The proportion of the labour force employed in manufacturing is around 11%. Primary sector processing (food and forestry) makes up a significant proportion of the sector.

The food manufacturing industry produces high-quality products for both the domestic and export markets. This industry enjoys the advantages of a natural environment that is highly conducive to pastoral agriculture, an absence of major agricultural diseases, the potential for year-round production and an international reputation for excellence. The industry had sales of over $43.8 billion in the year ended September 2015, including $28.8 billion for meat and dairy products.

Output in the manufacturing sector contracted sharply during the GFC, owing to weakening demand both domestically and globally. Manufacturing output recovered somewhat over late 2010 and early 2011, despite the Canterbury earthquakes, and continued to grow solidly in 2012. Negative growth was recorded in the first half of 2013 as a result of the elevated exchange rate affecting international competitiveness and the impact of the late summer drought. Output grew strongly in the second half of 2013 as a recovery in agricultural production led to a rebound in food processing.

Manufacturing GDP was broadly flat over the first half of 2014, as dry conditions resurfaced in the North Island and a rise in the exchange rate put competitive pressure on exports, but output recovered later in the year as agricultural production recovered. Manufacturing GDP has declined slightly over 2015.

The following table sets forth the sales of goods and services in the manufacturing sector for the five years ended 30 September 2015. It also shows the manufacturing index for the same period.

Table 10 - Operating Income of the Manufacturing Sector by Industry Group
  Year ended 30 September

2011 2012 2013 2014 2015 2015
Industry Division (dollar amounts in millions) % of Total

Food

           
  • Meat and dairy
27,456 27,521 27,372 32,725 28,813 29.3
  • Other food, beverages and tobacco
13,786 14,123 14,710 14,866 15,043 15.3
Machinery and equipment 9,953 9,949 9,677 10,148 10,578 10.7
Metal product 9,235 9,165 8,912 9,146 9,516 9.7
Chemical, polymer and rubber product 7,436 7,995 8,497 8,945 8,946 9.1
Petroleum and coal product 9,060 9,609 9,475 9,547 8,436 8.6
Wood and paper product 7,860 7,736 7,718 7,964 8,167 8.3
Non-metallic mineral product 2,424 2,489 2,724 3,116 3,301 3.4
Textile, leather, clothing and footwear 2,227 2,224 2,370 2,297 2,298 2.3
Furniture and other manufacturing 1,699 1,596 1,613 1,731 1,758 1.8
Printing 1,697 1,680 1,550 1,670 1,572 1.6

Total

92,833 94,088 94,617 102,155 98,426 100.0
Manufacturing Index[1] 108 106 110 112 113  

Source: Statistics New Zealand

  • [1]Base: June quarter 1996 = 100.
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