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Allan Barber says allowing fossil fuel emitters to offset 100% of their emissions by carbon farming gives them an unjustified advantage over food farming land uses, hollowing out the hill country communities especially

Rural News / opinion
Allan Barber says allowing fossil fuel emitters to offset 100% of their emissions by carbon farming gives them an unjustified advantage over food farming land uses, hollowing out the hill country communities especially
abandoned town

A report on recent land use change commissioned by Beef+Lamb NZ and long-term data collected by the Economic Service demonstrate a major reduction in sheep numbers and the accompanying downward slaughter trend. These combine to show a huge threat to the economic and social future of a number of rural communities. They also underline the danger of the unintended consequences that arise from the often misguided, if well-intentioned, policies of successive central and local governments.

Land use change will always occur naturally according to market forces or in the 1980s because of the removal of subsidies, but more recently it has been driven by artificial factors, mainly linked to the carbon price set by the ETS. The logical consequence of the ETS is the sale and purchase of large areas for plantation forestry, either to generate carbon credits to offset emissions or for government funded programmes like planting one billion trees to meet our international commitments.

Agriculture, being the largest driver of economic activity, has regrettably been blamed by vocal minority groups with incomplete knowledge of the facts for causing over half New Zealand’s emissions. These groups exert undue influence on the politicians who may only have three years to attempt to make their mark for posterity. Although it is impossible to develop workable policies which will address enormously complex issues in such a short timeframe, one electoral cycle after another we cast our votes and inevitably end up with a bunch of inexperienced amateurs who are motivated by the main issues of the day.

Climate change which now appears to be undeniable has become the major driver of policy, but the policy response lacks balance. In its haste to burnish New Zealand’s environmental and planet saving credentials, the Labour government, encouraged by James Shaw as Minister for the Environment, has ignored the recommendations of the Climate Change Commission and the scientific facts by persisting with the demand for unachievable methane reductions. The persistence with measuring methane emissions as though they are the same as carbon flies in the face of reality. The continuing ability of fossil fuel emitters to offset 100% of their emissions puts carbon farming at an unjustified advantage over alternative land uses like traditional hill country sheep and beef production.

While the previous Labour government claimed to recognise the importance of agriculture to New Zealand’s prosperity, citing its work to complete trade agreements with the UK and EU as evidence, the massive focus on regulations without due consideration of their impact suggests it was only paying lip service. While acknowledging the sincerity of the Greens in their desire to minimise New Zealand’s impact on climate change, I also believe they are naïve enough to think money grows on trees (literally and figuratively) and do not understand the need for a productive economy founded on our natural resources and growing conditions.

B+LNZ Economic Service figures show pastoral land declining by 4.2 million hectares or 41% over 30 years with sheep and beef falling by 5.1 million hectares, partially offset by an increase in land for dairy production. The remaining loss of pastoral land is attributable to multiple factors, including blanket forestry, tenure review, DOC Estate purchases, viticulture and horticulture, and urban subdivision into smallholdings and lifestyle blocks. Over the same period since 1990, New Zealand’s population has increased by 53% - lower than India and Saudi Arabia, but much greater than Germany, France, UK and USA - from less than 3.5 million to 5.11 million.

Unfortunately successive governments have failed to invest sufficiently in infrastructure to cope with immigration, while the country’s per capita productivity has failed to improve in compensation for the amount of input. Agriculture has consistently done more than its share to earn wealth and overseas exchange to pay for what New Zealanders consume, but has been penalised for its inevitable greenhouse gas emissions profile, especially since 2017.

The Economic Service has carried out a net present value analysis of the respective uses of a class four hill country farm which shows sheep and beef production has a 36% higher return over 30 years than straight harvest forestry. But adding in ETS units at a notional value of $70 per unit blows traditional sheep and beef farming out of the park by increasing the NPV to over 2.6 times what that is worth. Carbon farming alone without harvesting further worsens the calculation, making me wonder if the whole ETS system is not just an artificial market distortion.

The Economic Service makes the point the increase in afforestation has the perverse effect of hollowing out rural districts with the removal of livestock and, in the case of sale to a foreign owner or as a carbon farm, a lack of resident input to sustain local businesses and employment. Hill country farms are the most likely to be sold for forestry conversion. Over the five and a half years from 1 January 2017 to 30 June 2022, there have been 210,000 ha whole farm sales for afforestation with an estimated backlog of 11,000 ha to be planted awaiting seedling supply. Almost half of these sales have required OIO approval and land prices bought on the open market for forestry have risen 95% in the North Island and 84% in the South Island since 2019.

Little wonder landowners are willing to sell, when the land value justified by sheep and beef production is multiple times lower. We must hope the next government, whatever its composition, takes a more balanced and realistic approach to New Zealand’s obligations. In my next column I will assess the potential impact of the reduction in livestock numbers on meat processing capacity and the communities in those regions.


Current schedule and saleyard prices are available in the right-hand menu of the Rural section of this website.

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13 Comments

I wouldn't worry. Having an exorbitant admin fee on ETS registered land and a government promising a return to subsidising polluters with fake cheap imported "credits", will kneecap any desire to plant trees. 

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Unfortunately successive governments have failed to invest sufficiently in infrastructure to cope with immigration

And yet here we are again opening the flood gates.  

Capture all the carbon you want, tax the farmers to death...but self defeating when we have a growth popn policy.

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Yes. Irrespective of the debate about whether and how quickly and by what methane definition farmers should pay carbon fees, the governments position on immigration is simply absurd.

We have absolute carbon targets not per capita targets. The massively high immigration rate run by successive governments just makes the targets harder and more expensive to achieve.

We also get the massive social and infrastructure deficits to go with it.

There is simply no strategy at government level and high immigration is simply used as the sugar rush to pump absolute gdp growth rather than targeting wellbeing per capita as they should.

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85% of NZ fire-fighters are volunteers - that's pretty impressive eh.

More impressive, in my opinion, is that those volunteers are the sharp end of protecting  around 95% of the NZ land

Each volunteer receives a $380 annual grant in appreciation for their commitment to protecting their communities and as a contribution to costs of getting to station or incident.

It's getting harder to attract volunteers in rural areas and crews are getting older. Yet is those rural areas that, arguably, face the highest risk of vegetation fires that can release the  stored carbon (in new carbon forests) back into the atmosphere.

With carbon farming, the whole risk profile is changing.  Whereas in the recent past, pine forests were often typically established as production plantings in relatively small (say 2-10ha) discrete blocks on low pastoral productivity areas of a farm (e.g. classes 5-8 country, or difficult to manage corners, etc), which allowed for a degree of lower fire risk pasture "fire breaks" between blocks. Now blanket planting of whole farms is occurring. From what I have heard and seen, there is zero fire management consideration in the planting program. Farm access tracks are planted over, dams (fire fighting water source) are planted to water's edge.

Yet when the fertiliser will hit the fan, that standing army of volunteers living in the communities that are experiencing depopulation as a result of carbon farming, are expected to respond.

That's a pretty s**t situation bro.

Those corporate carbon farmers really seem to enter these communities with a zero care and zero responsibility approach.

It really must change and change fast.

 

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Well , the naive Greens have gone now , so you can have your "science" based policy from NACT/ NZF .

Even better , you can pretty much bet they are not going to do anything for the next 3 years , if they last . 

I wonder who the naive ones really are???Have a Nestle bar.

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While acknowledging the sincerity of the Greens in their desire to minimise New Zealand’s impact on climate change, I also believe they are naïve enough to think money grows on trees (literally and figuratively) and do not understand the need for a productive economy founded on our natural resources and growing conditions.

+1

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No , they knew if we didn't plant carbon trees, we would be spending alot more purchasing credits overseas. What do you think the carbon price is going to do as 2030 approaches, and every country is trying to buy them. They also used the proceeds to subside projects that reduced emissions. National will take that money to pay for tax cuts. 

Oh and by the way, Shaw got the ETS underway in cooperation with the last National govt, I wouldn't wave him goodbye just yet.

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D.p

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1 slight problem with these numbers. The area of exotic forest is the same it was at its peak around 20 years ago - just. In fact the period of time when we lost the most sheep and beef numbers also coincided with a massive drop in forest area!!

Again not talking about the real issue- it's simply not profitable in many places and getting worse. All very well to have animals to process but if the grower is going broke? 

Until this is recognised and honest discussions about this and possible solutions the decline will continue. Easier to blame something or someone.

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Sounds like a typical anti-forestry rant without much fact. Good profitable hill country is still being farmed, but there is a lot of hard country that it is not possible to make a living off. What should be done with that land? maybe the Govt could pay us to stay on and compensate our.......oh hang on isn't that subsidies and everyone loves farmers being subsidized. That's the reality if that marginal land is to stay in animal production someone has to prop it up.

Or we could plant trees and live of carbon on the worst land which will subsidize the better country. Yep, reality of farming isn't as clear cut as the likes of the above author would have one believe.

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Agree Hans, I've almost given up commenting as these people can't add or subtract and are living in a fantasy, unreal world where they can't accept reality.

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You’re fighting the good fight Jack Lumber. 

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