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Manufacturing Matters- Tuesday Top-Up 72

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What’s Been Happening in our MAKE│NZ Community

•We’re hiring!

Our Community of manufacturing leaders keeps growing, so we are looking for someone to support that growth. The new Community Development Manager will play a key role in shaping that Community, building relationships with members, and helping MAKE│NZ to grow the collaborative, reciprocal network we aspire to be. Do you/are you able to

  • support our purpose and the idea behind MAKE│NZ? Are you able to embrace and champion our Community concept?
  • have experience in manufacturing, engineering, or a related technical field?
  • have the mental agility and adaptability to work in a small dynamic team where ‘the job’ will change as the situation requires?
  • listen with empathy and handle confidential conversations with sensitivity and discretion?
  • have an interest in ‘the big picture’ in manufacturing, and are able to share high‑level insights with members of our Community?

If so, we are keen to hear from you! The position will be available for full-time or part-time employment, or on a contract basis. To find out more, and tell us you’re interested, please get in touch (dieter@makenz.org / sabine@makenz.org )

Future Events

•Business Canterbury are organising a Manufacturing Futures Forum: Funding and Growth Pathways on Wednesday 25th March 4.30pm – 6.30pm. For details and registration, please see here


News From The World of Manufacturing

Crude oil prices as at 10:00 a.m. on March 10. The latest drop has been ascribed to comments by the US President that “I think the war is very complete, pretty much”.

•Very few New Zealand manufacturers will use products derived from crude oil (diesel) as a source of process heat, so the exposure will mostly be indirect via freight costs. As far as natural gas goes, we don’t import LNG (yet) and there is no publicly available information on whether recent developments have had any impact on the price of domestic natural gas.

Wholesale electricity prices have been mostly below $200/MWh since the start of the year …

… and hydro lake levels are at or well above average levels for this time of the year:

•No reason to be overly concerned, then? Road transport costs will rise via the Fuel Adjustment Factor, a variable fuel surcharge, which looks like it could be as high as 25% or above. Likewise, bunker surcharges on container services to and from NZ can be expected to rise in line with bunker price averages.

Since NZ is far from major markets, fuel is a relatively large component of the cost per TEU compared with shorter trades, so long‑haul routes (NZ–Europe, NZ–North America) are particularly exposed. So far, however, we don’t see any major changes in container freight rates …

… with minor rises only in the transpacific rates. In terms of supply chain disruptions, apart from New Zealand exports to the Gulf states that need access through the Strait of Hormuz, disruptions should be minimal, at least in theory. Major shipping lines had only just started using the Suez Canal route again on an exploratory basis and will be happy to go back to the longer route around the Cape to absorb excess capacity.

The biggest risk to New Zealand manufacturers will be the impact of the conflict in the medium term. The war may be going on for longer than some may have expected or wished, with bigger disruptions to some major economies New Zealand manufacturers trade with. While it doesn’t affect us directly, LNG prices in Europe have risen dramatically …

… and for China, the world’s largest importer of LNG, supply disruptions for this commodity could have severe consequences as it still has very limited storage capacity onshore – unlike for oil.

The big concern, both domestically and in many key OECD countries, will be the impact on inflation, already showing early signs of reversing recent downward trends. That, and how central banks will respond.

Other news of interest to manufacturers

•What does it tell us if the OECD in its latest Global Debt Report 2026 uses this image on the front cover:

The sub-title of the report might provide a hint:

Sustaining Debt Market Resilience Under Growing Pressure

Without diving too deep into the 160-page report, a few graphs paint a fairly consistent picture:

Globally, the amount of debt issued is rising steadily again after the COVID-19 spike, both in terms of absolute amounts, and share of GDP.  And as the debt increases, so does the price of borrowing. The bulk of that is government debt in the OECD, and the bulk of that is in the US:

Net Borrowing represents the difference between government revenue (income) and expenditure (spending). Debt refinancing replaces an existing loan with a new one.

What goes up, must come down – or does it? And if so, when, and how? That uncertainty is the main reason why investors shun longer-term bonds, relatively speaking – both for government and corporate debt:

So, what does it all mean? The quip “It is difficult to make predictions, especially about the future.” comes to mind. But questions about the stability of the global financial system may also come to mind, and about the wisdom of banking on the strength of the US economy.

Fun Facts (Some of them not so funny)

•Last week we talked about the fact that business risk – and the perception of it -increases when predictions become less reliable about how the state of commerce will develop, both on a grand scale, and for your immediate environment / company.

There is a measure for that: The Economic Policy Uncertainty [EPU] index, based on automatic text searches in a large number of newspapers internationally. The index is curated by a group of leading US economists. It reflects trade policies, rather than trade practices, but especially at times when trade policies become highly interventionist, the link between the two emerges quite clearly:

Putting this in perspective, and looking much further back than the seven years in the above graph, shows that we clearly “live in interesting times”:

Does it matter? The experts behind the EPU have found that “…policy uncertainty is associated with greater stock price volatility and reduced investment and employment in policy-sensitive sectors like defense, health care, finance, and infrastructure construction.”

•A nation in decline? Each year in January, Gallup conduct a Mood of the Nation poll, surveying a sample of the population on their views on how the US is doing, covering 25 categories to measure Americans’ satisfaction with broad aspects of U.S. Society:

On the upside, though, almost half of those surveyed still believe that there still is the opportunity to get ahead if you just work hard enough …

And, finally, it looks like space for people to work is giving way to space for AI:

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