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Strong exports boost our Thames-Coromandel economy

27 August 2018

Our economy in Thames-Coromandel continues to expand, buoyed by strong prices for export goods such as dairy and wood, and more opportunities to work.

The latest quarterly economic data release from Infometrics reveals GDP in Thames-Coromandel was up 3.3%, at $1,092 million in the year to June 2018. That's well above the 2.6% growth rate for the wider Waikato region, and the rate of 2.7% nationally.

Infometrics says, on most indicators, our district's economy has performed well in the three months to June, calling out strong dairy and wood prices.

Growth in international wood prices has driven up the harvest rate of forests, with the value of New Zealand’s timber and log exports climbing 18% to $5 billion over the June 2018 year.

The dairy payout for farmers in our district is expected to be about $55.9 million for the 2017-18 season, $3.67 million higher than last season. It will be the third profitable season in-a-row for dairy farmers, and is despite the fact dairy prices fell during the quarter  as demand from China softened.

Looking ahead, Infometrics warns spending growth among farmers will be held back by high debt levels and concerns over Mycoplasma bovis, a bacterial disease affecting cows.

Economic growth is also creating jobs in our region. The average number of people receiving Jobseeker Support fell by 6.3% in the June 2018 year, which Infometrics says is a strong result, considering the numbers edged slightly higher nationally by 0.05%.

Our unemployment rate remains very low at 2.8% and that's particularly impressive since migration (an annual gain of 171 people) has boosted our district’s labour supply.

Thames-Coromandel’s unemployment rate also compares favourably to the national average of 4.5% and the average for the Waikato region of 4.4%.

Local spending boost

On the back of strong dairy and wood prices and improved labour market conditions, electronic card spending on retail purchases in the district grew by 6.9% in the year to June, well ahead of the national average growth of 4.4%. Farmers are also driving growth in commercial vehicle registrations, up 5.9%.

Traffic flows, another good indicator of economic activity, rose 5.7% in the June 2018 year, while tourism expenditure and guest nights are up 5% and 3.4% respectively.

Our Mayor Sandra Goudie says it's positive to see the pay-off from the recovery in dairy prices since the second half of 2016 and the strength in other export commodity prices coming through in our economy's performance.

The low unemployment rate continues to be a  highlight of the recent data, Mayor Sandra says.

"Our council is serious about creating vibrant, strong communities and stimulating economic development," Mayor Sandra says.

"We are here to help our business sector wherever we can. It's entrepreneurs and business people that create jobs by establishing and investing in businesses on the Coromandel. Our mission is to create an environment for the private sector to invest in our district."

Thames-Coromandel district quarterly economic update

HIGHLIGHTS:

  • GDP: +3.3%
  • Traffic flows: +5.7%
  • House prices: +2.2%
  • House sales: -23%
  • Residential consents: +6.6%
  • Guest nights: +3.4%
  • Retail trade: +6.9%
  • Tourism spend: +5%
  • Jobseeker support: -6.3%
  • Unemployment rate: 2.8%

For more details on our latest economic quarterly data for our district go to our website page here.

Our Council uses Infometrics to provide industry, regional, and general economic analysis and forecasts, which helps to inform us when we make planning, policy, and strategic decisions.

Read more about our Council's  Economic Development Strategy 'Towards 2028' here.