New Zealand Exports, Tourism Fight to Recover

New Zealand timber

By Reuters 2016-12-14 23:40:15

Parts of New Zealand's key export industries and its vital tourism sector are battling to get back on track a month after a deadly earthquake rocked the nation, crippling roads and slowing shipping.

At one of the country's main ports in Wellington, “no-entry” signs dot parts of the site hit by cracking or buckling, hampering shipments of items like meat and farm produce to destinations including China and Australia.

While 150 kilometers away in the resort town of Kaikoura, often touted as the nation's whale-watching capital, restaurants and hotels lie nearly empty as the roads that once carried in busloads of tourists through steep mountains remain closed.

Wellington's port and Kaikoura are at the forefront of fallout from the November 14 quake, which New Zealand's central bank has initially estimated will cost the NZ$250 billion ($180 billion) economy up to NZ$8 billion.

"We are important to the regional economy, so it is important to resume (full) operations soon," said Derek Nind, CEO of CentrePort Wellington, the port in the country's capital which lies about 480 kilometers from the epicenter of magnitude 7.8 temblor that killed two people.

"We need to think how we build resilience into our ports. I am trying to get world experts to help us on that."

Nind added that the port, which handled trade worth NZ$3.3 billion in 2015, was unlikely to run at full throttle until April, although it did manage to partially resume some operations in the days after the quake.

Major problems at the site include container shipping and cold storage that remain out of bounds, while Nind's own office is also in a no-go zone.

Nind said it was not yet possible to assess how much business would be lost due to the quake.

One sign of progress comes as the port says its key log shipping operations are "back to normal" in December after they were hit the month before.

That is good news for companies that rely on the port as one of the main shipping points for New Zealand's rapidly growing forestry industry, its third-largest export earner behind dairy and meat.

"November will probably be our weakest month on calendar, although things have started to flow back now," said Steve Wilton, CEO of Masterton-based Forest Enterprises, the nation's number one forestry investment firm.

He said that the company had been diverting some of its logs to nearby Port Napier, but that had caused additional cost and delays.

Meanwhile, Philip Gregan, CEO of wine industry body NZ Wine said that one in five tanks in the producing region of Marlborough had been damaged during the earthquake.

That has left winemakers scrambling to find temporary storage or ship wine out to be stored elsewhere to ensure the 2017 vintage is not affected. New Zealand's wine exports are worth NZ$1.6 billion and growing fast in markets like China and the United States.

"They've got a lot of work to do and they're working very hard to make it all happen. They would have loved if this earthquake had never happened, life would have been a hell of a lot easier - but that's not what happened," Gregan said.

NO TOURISTS

Tour operators and hotels in Kaikoura on the country's South Island say they are struggling to survive as blocked roads keep would-be visitors from using the town of 2,000 as a base for trips to watch whales, dolphins and seals.

The government has indicated that roads will not reopen for months, scuppering the all-important Christmas holiday period.

Whale Watch Kaikoura Ltd typically handles around 770 tourists a day during the traditionally busy December to March period, but that is down to zero now, said General Manager Kauahi Ngapora.

That means hotels and backpacker lodges in the region also remain vacant. Tourism accounts for 12 percent of Kaikoura's economy, more than three times the dependence in Christchurch, New Zealand's third largest city which had parts flattened in twin earthquakes in 2010/11.

"The great tourism boom has virtually stopped," said Lynette Buurman, business manager at tour company Encounter Kaikoura.

The government has also been forced to slash its 2016/17 budget surplus estimate by more than a third to NZ$473 million due to costs related to the quake.

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