15 Mar 2011

Exporters confident about Japan, despite disasters

10:38 pm on 15 March 2011

Exporters are optimistic New Zealand's four-billion dollar Japanese market will hold up despite the earthquake and tsunami.

Wood, aluminium and meat products form the backbone of the $4 billion Japanese export sector, which may actually be boosted following the quake.

New Zealand Aluminium Smelters is continuing full production for the Japanese market .

General manager Ryan Cavanagh says deliveries are still leaving the plants on schedule, but aluminium already on its way to Japan has been diverted to other Asian ports to be distributed to manufacturers elsewhere.

Most of the New Zealand aluminium sent to Japan is used by manufacturers in the southern part of the country.

Mr Cavanagh says the company expects to know the full impact of the disaster on its business within two weeks.

However, demand for aluminium may actually increase as the company looks to supply other countries which traditionally relied on product from Japan.

Wood exporters say Japan will rely on New Zealand for materials to rebuild.

They say New Zealand companies will be able to fill the void left by destroyed Japanese wood processing plants, especially for products such as plywood.

Pan Pac Forest Products managing director Doug Ducker says Japan has lost a factory that produced more than 25% of the country's plywood.

In the meat sector there has been frustration with delays at Japan's ports, but the indications are that once supply lines are open again, demand for New Zealand meat will remain high.

Dairy giant Fonterra says the Japanese market is very important and it is closely monitoring the situation, but it is too early to know what effect will have on its business.

Fonterra says its 69 staff in Japan are safe, but its Tokyo office is closed and a travel ban is in place.

Food manufacturer Heinz Wattie's Ltd is not expecting significant disruptions to its operations or exports at this stage.

Managing director Nigel Comer says the 200 staff at Heinz Japan, including those in the sales office near Sendai, are safe.

He says more than 20,000 tonnes of canned and frozen goods are exported to Japan each year.

Japan is New Zealand's fourth-largest trading partner.

Bank of New Zealand senior economist Craig Ebert says food products, forestry, and aluminium are the main exports likely to be affected but there's no simple answer as to how bad the disruption will be.