Port of Tauranga is expecting earnings growth to stall next year in the face of log and dairy uncertainties.
Chief executive Mark Cairns told the country’s biggest port company’s AGM that the uncertainty over logging and dairy volumes may offset growth in containers.
He said that overall trade had dropped 2% in the first quarter of the 2016 year, reflecting a 17% decline in log exports. A new mill in Rotorua was a contributing factor in the reduction.
That drop was offset by a 21% gain in dairy volume and an 8% increase in containers, he told the meeting.
“Despite the positive increase in container volumes, due to the uncertainty around log and dairy volumes, along with the flow on effects to imports of farms inputs such as fertiliser and stock feed supplements, at this early stage we expect to achieve full year earnings similar to last year,” Cairns said.
“Having said that, we do note the recent Agrifax report released earlier this week, reporting of a pick-up in demand, which has significantly reduced inventories on Chinese ports from 4.7 million tonnes to approximately 3 million tonnes, supporting an increase in average wharf gate prices.”
