Agriculture will change but pastoral agriculture will survive and prosper. It is all about international competitive advantage, new technologies and managing the environment. It can be done but it won’t be easy

One of the regular questions I am asked about is the future of pastoral agriculture. It reflects a perspective that, given the issues of water pollution, greenhouse gases and changing consumer attitudes, perhaps New Zealand’s pastoral agriculture belongs to the past rather than the future.

A good starting point for a response is to reflect as to why New Zealand developed as a pastoral-based economy. Nature blessed New Zealand with a temperate maritime climate combined with a hilly and mountainous topography that is well suited to pastoral agriculture, but much less suited to crop activities.

Compared to much of the world, New Zealand’s natural competitive edge still lies in pastoral sheep, beef and dairy.  In contrast, the economics of broad-acre cropping and vegetable production are challenging in an environment where flat land is limited and where rain can occur, or not occur, at any time.  New Zealand can grow wheat, barley, potatoes and lettuce for the local market, but selling them profitably on world markets has never worked particularly well. 

More than 75% of New Zealand’s physical exports come from primary industries. Despite the great successes of kiwifruit, wine, apples, subtropical fruit, timber and fish, some two thirds of these primary exports still come from pastoral agriculture.

Bringing the above numbers together, that makes pastoral agriculture the rock on which half of the export economy is built.

It is helpful to remind ourselves of the biophysical processes that underpin pastoral agriculture. It starts with conversion of carbon dioxide and water into plant carbohydrates, using nature’s own wonderful energy source called ‘the sun’. The process is called photosynthesis.  

However, plants need protein as well as carbohydrates. Nature has organised that as well, by creating a plant family called legumes, with clovers the most important, but others such as lucerne playing an important role. These legumes extract nitrogen from the atmosphere with the help of rhizobia bacteria and convert the nitrogen into protein.  

When animals eat clover and other legumes, there is typically more protein than the animals need. The excess gets excreted, mainly in urine but also in animal faeces. This provides the nitrogen to the soil that is needed by non-legume species including grasses.

Nature truly is wonderful the way it has organised itself. However, a big problem arises when humans start removing large quantities of animal products from the pastoral environment, leading to a deficit of key nutrients. If these are not replaced, then nature’s natural processes cannot work.

Also, nature does not always get things quite right from a human perspective. Nature’s geological processes have bequeathed much of the South Island with a deficiency of selenium. This does not trouble the plants but it does trouble farm animals. Similarly, the volcanic Central North Island lacks cobalt, the absence of which causes ‘bush sickness’.  There are many more deficiencies in specific regions.

I also get asked a lot about organic agriculture and regenerative agriculture.

Organic agriculture is relatively easy to talk about. The rules are clear cut. The systems can be made to work on good quality soils, but in general, significant price premiums need to be achieved if the systems are to produce economic returns.

It’s hard work when farmers cannot use modern cost-cutting technologies. I applaud farmers who are able to make these organic systems work. However, I also know farmers who have had to forego their organic systems because of a lack of resilience to pests and climate when nature turned against them.

Within any farming system, marketable products and the nutrients therein are removed from the land. Within organic systems, it can be challenging to bring enough nutrients back to the farm. For that reason, and unless the human waste is brought back to the farms, including from overseas, then it is very hard to scale up organic systems to a national level.

As for regenerative farming, that does get confusing. This is because regenerative farming is a concept that has no clear rules and hence there is no certification.

Regenerative agriculture philosophy comes from the USA where many of the traditional farming methods of the last 100 years were depletive. Many American soils are naturally highly fertile, and American farmers were able for prolonged periods to apply depletive practices that New Zealand farmers could never apply.

Regenerative agriculture has a focus on soil improvement, and surely no-one should argue about that. The problem occurs when regenerative farming becomes a mantra devoid of science. And that is why scientists sometimes get their backs up. The starting point has to be a focus on nutrient cycling, and fixing up some of the holes in the system through which nutrients escape.

New Zealand pastoral agriculture was built on regenerative principles, with clover-based pastures on almost all classes of land, combined with cropping rotations that included an animal phase on the better soils. Dairy farming has subsequently moved to placing much emphasis on bag nitrogen, with consequent improvement in production, but sheep and beef farming still rely to a great extent on legumes.

I started my career a long time ago as a Ministry of Agriculture farm adviser. I used to collect soil samples, send then to the laboratory for analysis, and then convert the results to fertiliser recommendations. Most of the Canterbury soils were very low in organic matter. Now, when I revisit those farms fifty years later, the changes that have occurred – for the better – are remarkable.  Our farming systems of those days, including cultivation and wind-blown soils, were totally unsustainable.

There remains a widespread notion among urban folk that crops, including lots of vegetables, are what New Zealand needs to focus on. There is a poor understanding that some of New Zealand’s worst nitrogen leaching is associated with vegetable production. In any case, most of the world thinks it is quite capable of producing its own vegetables, and they are expensive to transport.

The other suggestion people give me, sometimes with great confidence, is that much of our pastoral land must go to timber. Sometimes I have to bite my tongue. Carbon credits are all very well, but they are primarily for internal use within the NZ economy. They are not an export substitute. I also gently remind people that much New Zealand timber is used in China for formwork and subsequently burned. There won’t be much need for formwork when today’s newly planted trees are ready for harvest. Before then, China’s big infrastructure development phase will be well over.

Of course, this would all count for nothing if market demand for New Zealand’s pastoral products were likely to decline. I have written about that before and will do so again. There will always be challenges and there will always be volatility, but there is lots to be positive about as long as we get our act together.

As for the biophysical environment, I remain confident that we can solve the big issues facing pastoral farmers. But both our systems and our thinking will have to change. The biggest transformational technology will be the ‘composting mootel+pasture’ system. It will still be pasture-based farming, but uniquely suited to New Zealand. I have written about that before, but industry understanding remains low. However, the technology exists and mootels are being built. I expect to be writing more about it.

*Keith Woodford was Professor of Farm Management and Agribusiness at Lincoln University for 15 years through to 2015. He is now Principal Consultant at AgriFood Systems Ltd. His articles are archived at http://keithwoodford.wordpress.com. You can contact him directly here.