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90 seconds at 9 am: German growth low; NZ wants direct convertibility with yuan; ANZ sending 500 AU jobs to NZ; beef prices higher; NZ$1 = US$0.809, TWI = 76.3

90 seconds at 9 am: German growth low; NZ wants direct convertibility with yuan; ANZ sending 500 AU jobs to NZ; beef prices higher; NZ$1 = US$0.809, TWI = 76.3

Here's my summary of the key news overnight in 90 seconds at 9 am, including news it is a holiday weekend in North America and in much of Europe so markets will be quiet today with little offshore influence from those two regions.

Germany's economy barely grew in the first quarter of 2013 as exports and investment shrank, the latest data shows.

But higher domestic consumption - thanks to rising wages - helped offset the declines in foreign trade and capital investment, raising hopes it will help a recovery.

German GDP rose 0.1% from the previous quarter, but it was down 1.4% compared with a year earlier.

New Zealand is reported to be in talks with China to make the yuan directly convertible. That would reduce financial costs in our quickly expanding trade.

Apparently these talks are in their early stages and apart from a political confirmation the matter is on the table, neither the RBNZ nor the PBOC is commenting.

New Zealand is also the destination of 70 jobs being 'offshored' by ANZ in Australia. Apparently its part of a plan to switch 500 positions from there to here over five years, mainly through attrition in Australia. They are being added here much to the ire of Aussie unions.

Commodities start the week on a softer note with oil and metals down, along with most agricultural commodities.

The exception is beef prices which are stronger , not only from higher prices in the important US summer season, but surprisingly strong demand from China.

Softer - but still high - global dairy prices aren't yet being reflected in New Zealand because our currency has fallen faster and so we are seeing lower prices in US dollars, but higher prices in NZ dollars.

The NZ dollar starts today at 80.9 USc, 83.9 AUc which is its highest since January 2009, and our TWI now stands at 76.3.

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15 Comments

It was highlighted at a public meeting about the unitary plan in Northcote last night that the Auckland Council has fiddle population growth figures to use as their a basis for the plan. Didn’t Bernard Hickey discuss this at one point in time?

     Anyway the woman presenting this information had tried (by private correspondence)to call the town planner to account for his methods and the town planner has been unable to justify the use of his projections. I do understand that population predictions are usually made with an upper and lower limit with an middle path probably being the sensible figure to use as the basis for a plan. In this instance the Unitary Plan is based around the maximum figure. 

     Len Brown failed to appear at the meeting .

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Using Aucklands historic growth figures (2.2%) and projecting them decades into the future gives a thorougly unsustainable doubling every 30 years. 3 million by 2033, 6 million by 2063 and so on - about 100 million in 180 years - double it's present age.

Perhaps someone should be asking these geniuses wether that is a good thing to aim for? 

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Video private?

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I'm getting This video is private too

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You are not missing much Wordsmith, It's much clearer reading it anyways...

Sounds about right with respect to the councils response to the querry. I have called many times due to a different matter and have been repeatedly told I would be contacted by the appropriate person. I am still waiting, and it has been a few months now... Different scenario if one fails to contact them over a letter of enquiery or one is late paying rates.

Double standard...? Nah, they are simply King and master (in their mind!) of their rate payers.

HGW

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When the other side run the supply chain.

China and India are reported to have signed a Memorandum of Understanding this week over direct exports of Indian buffalo meat.

The agreement was struck during Chinese Premier Li Keqiang’s first visit to India.

According to local media reports, the MOU agreement, including ‘minimum safety requirements’, was signed by India’s ministry of commerce and industry and China’s ministry of quality supervision, inspection and quarantine.

Www.beefcentral.com

The Chinese demand for Indian buffalo could be worth US$ 1.5 billion a year, an industry analyst said. That estimate was based on a price at or near US$3000/t (Indian buffalo meat trades at a big discount to conventional beef) which could stimulate annual trade totalling 500,000 tonnes, one report said.

According to projections from Gira Consultants, Indian buffalo meat accessing the Chinese market currently totals only about 5000-7000 tonnes via the grey channel, out of total Chinese beef imports of about 340,000t in 2013.

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So what is our tonnage for context Henry? Both total and to China?

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Say (not to be confused with the NZ Sliced Lamb):

In the first quarter of this year New Zealand exported 60,000 tonnes of meat to China, threequarters of that sheepmeat. New Zealand supplies only about 1 per cent of China's total meat imports a year, industry sources said.

http://www.stuff.co.nz/business/8700625/China-meat-access-teething-prob…

 

In what meat exporters hope is the start of a Chinese food boom, by the end of this week more than 50,000 tonnes of Australian beef will have been sold to China this year.

That is nearly double all the beef exported to China last year and puts China on track to take a record-breaking 100,000 tonnes of Australian beef, valued at more than $500 million, this year.

 

http://www.theaustralian.com.au/business/meaty-profits-amid-chinas-stam…

 

The unprecedented Chinese demand for beef and lamb comes as Asian consumers abandon their preference for chicken meat amid concerns about the H7N9 bird-flu virus.

The trusted image of New Zealand lamb and mutton has also suffered a blow after Shanghai authorities arrested local meat wholesalers for selling rat, fox and mink meat injected with chemicals that was being passed off as "NZ sliced lamb".

 

 

 

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Know your customer

Meat processor and exporter Silver Fern Farms (SFF) says it is reaping the rewards of 15 years of trading with China.

The farmer-owned co-operative, with a $2 billion turnover, sold $170 million of meat and other products to China in the year ending last September. Meat and carcass product sales have risen 10 per cent yearly over the past few years.

Sales were made in 12 product categories including skins, offal and meat casings, as well as meat from sheep, deer and cattle. Beef and lamb cuts ranged from diaphragms, tendons and testicles to high-end lamb racks.

Chief executive Keith Cooper said the sales range showed the extent of Chinese demand.

He said Chinese customers had been identifying new products and trialling them on a large scale.

 

http://www.stuff.co.nz/business/farming/8367234/Meat-exports-thrive-in-…

 

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Worth a read: This seems a very good case study of produce export / building a consumer brand and the realities of international trade, FTA's and scale of tariff rates:

 

http://www.beefcentral.com/trade/article/3178

One of the great success stories of Australian export beef into the Korean market over the past decade has been the penetration of the Darling Downs Wagyu product into the E-Mart supermarket retail chain.

The Australian Agricultural Co’s Darling Downs Wagyu has been one of Australia’s true flagship beef brands in the Korean export market, helping ‘pull through’ a range of other products with it.  

But with the suffocating effect of Australia’s import tariff disadvantage against US beef in the Korean market, long-lasting, hugely successful and deeply committed supply alliances like this run a real risk of disappearing forever......

 

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That convertible Yuan/NZD deal:

 

Just a wild thought.

 

Being as how China is both the source of a fair chunk of our imports (other common taters much less lazy than moi can kindly supply the figgers), and our major export destination (same deal - the Quantum?), why not just remove all currency risk in both directions?

 

Why not simply peg NZD to the Yuan?

 

"I, for one, welcome our new Chinese overlords. I'd like to remind them that as a trusted common tater, I can be helpful in rounding up others to toil in their colonial dairy farms."    Attributed to some fella called Bent Krockman.

 

 

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Mate you are out of line, Friday is the day for funnies and this elicited a loud chuckle.

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Any insight into this?

http://brazilianbubble.com/argentinas-trade-barriers-make-brazil-exports-dive-30/

Is this the start of protectionism...

 

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Same reason Google can no longer make payments to developers in Argentina

http://www.theverge.com/2013/5/24/4363960/google-no-longer-able-to-pay-…

Where you effectively have to take a permission slip to the bank to make a foreign exchange transaction.

http://www.telegraph.co.uk/expat/expatlife/9565126/Damming-dollar-flood…

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