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Fonterra's Jeremy Hill points out that if the world's dairy producers were as emissions-efficient as New Zealand, the global carbon footprint from dairy would be more than halved

Rural News
Fonterra's Jeremy Hill points out that if the world's dairy producers were as emissions-efficient as New Zealand, the global carbon footprint from dairy would be more than halved

By Jeremy Hill*

Is pasture-based dairying in New Zealand a villain or hero when it comes to the production of greenhouse gases (GHG)?

The answer to this question depends on whether you take a narrow New Zealand perspective on a single issue or a global, more holistic view of the impact of dairy and the relative contribution of pasture-based dairying in New Zealand.

In 2015 the United Nations Framework Convention on Climate Change Paris Agreement1 and the 2030 Agenda for Sustainable Development2 with its 17 Sustainable Development Goals (SDGs) were ratified. Both set ambitious targets, and together they provide a common global context for combating climate change, ending poverty and hunger, improving health and education, making cities more sustainable, and protecting oceans and forests in a world that will see the population rise to almost ten billion people by 2050.

Next came the signing of the Dairy Declaration of Rotterdam by the Food and Agriculture Organization of the United Nations (FAO) and the International Dairy Federation.3 The Dairy Declaration recognises the importance of the dairy sector in contributing to the SDGs, including the critical role that dairy must play in sustainable development, and the essential role it plays in nutrition, food security and poverty-reduction and improved livelihoods.

Supporting the validity of the Dairy Declaration is a Global Dairy Facts document produced by the FAO. These facts on the socio-economic and ecological impact of dairy provide a compelling case that dairy will be critically important to the achievement of the SDGs.

The importance of the dairy sector is further elaborated in the soon-to-be-published text.4 For example:

—   Dairy is the number-one agricultural commodity by value, and through the provision of 240 million jobs, including 150 million farms and smallholdings, directly supports the livelihoods of close to 1 billion people.

—   Milk production also uses 1 billion hectares or 7 per cent of the Earth’s habitable land, of which 85 per cent is grassland (pastures and rangeland). Dairy cows consume 2.5 billion tonnes of dry matter or approximately 40 per cent of the global livestock feed intake. However, 77 per cent of this feed is human-inedible pasture, silage or straws.

—   Dairy is also key to healthy diets the world over. Most national dietary guidelines recommend one to three servings of dairy a day, which approximates to 500 millilitres of milk/person/day. Dairy protein is substantially higher in nutritional quality than plant-based proteins. Dairy can be the lowest-cost source of dietary calcium, riboflavin and vitamin B12 and is significantly more hydrating than water and many other beverages.

—   Increasing dairy consumption to match dietary guidelines could save billions of dollars in national health budgets and help reduce the incidence of a number of non-communicable diseases including type 2 diabetes, hypertension, cardiovascular disease, osteoporosis, rickets and stunting.

—   Even as annual global milk production reaches 800 billion litres, global consumption of dairy today is approximately 500 billion litres less than it should be on the basis of national dietary guidelines. Growing access to dairy to meet nutritional guidelines and enrich diets will need to be done through a balanced approach involving local dairy development programmes and international cross-border trade of dairy products.

A recent review of epidemiological studies on the environmental impacts of diets found that food-related GHG was strongly correlated with land use, nitrogen release, water use and eutrophication and air acidification, suggesting GHG as a useful marker for the environmental impact of diets.5 However, caution is needed, as environment is only one dimension of sustainability. Furthermore, the environmental impact of a food sector such as dairy can vary considerably as a result of the significant variation in farming systems used, as well as significant variation in the ecologies with which those farming systems interact across different regions of the world.

A recent study modelling emissions-pricing of foods and health impacts found that significant taxation of beef and milk would be both health-promoting and reduce food-related GHG emissions by approximately 10 per cent.6 However, the researchers recognised the limitations of the models they used, such as the health analysis being focused on changes in energy intake and consumption at the level of food groups and not taking into account changes in nutritional quality of diets. In fact, the widely accepted view that healthy diets are also good for the environment is not necessarily the case when nutritional quality is taken into account. Furthermore, any reduction in mortality due to reduced milk consumption under the assumptions and modelling used in this study is contradictory to the large body of evidence supporting the positive health impacts of milk and dairy consumption.

The review of epidemiological studies cited above concludes that given the incompatibility of some sustainable diet dimensions more studies are needed to create integrated approaches that combine nutritional adequacy, health impact, acceptability, affordability and different environmental footprints.

There is also a need for more knowledge and holistic approaches relating to food sustainability. No doubt further definitions and elaborations for what constitutes sustainable diets and food systems will be made over coming years.

So how do we combine all important socio-economic and ecological aspects to create frameworks and models that support sustainable food systems? Moreover, how do we do this in a way that is globally relevant and locally applicable; creates food security; accommodates the needs of developed and developing nations, scale farming and smallholder farming; recognises the diverse social and ecological needs of communities and the planet; and can operate efficiently and resiliently within what is a complex global food system?

If, in keeping with the Dairy Declaration of Rotterdam, dairy is assumed to be an essential component of sustainable diets and to help support the livelihoods of a billion people, then reducing milk production in order to reduce GHGs would result in significant negative outcomes. Instead, we need to seek to reduce GHGs from dairy while increasing milk production. Of course, not all GHGs are the same — which is particularly relevant to dairy, as methane represents almost half of dairy GHGs, the significance of which is explained by Oxford University physicist Raymond Pierrehumbert in a letter to the editor of the Economist (20 August 2016):

When you stated that methane is ‘25 times as potent’ a cause of global warming as carbon dioxide, you perpetuated the myth that there is a single conversion factor that translates the climate effect of methane into what would be caused by an ‘equivalent’ amount of carbon dioxide. The number you quoted is based on a measure called ‘global warming potential’. This measure exaggerates the importance of methane because it fails to properly reflect the importance of the short (12-year) lifetime of methane in the atmosphere compared with carbon dioxide, which continues to transform the climate for centuries.

A simple financial analogy is useful. If you opened a bank account for storing your methane emissions, it would be as if the account paid a negative interest rate of –8.3% annually ... The balance in the account represents the warming effect of the methane emitted.

If you deposited $1000-worth of methane today, in 50 years your account would be worth only $16. A big pulse of methane released today would have virtually no effect on the temperature around the time we hope global warming will be peaking. If you were to deposit a steady $100 of methane a year your account would be valued at $1205 in a few decades but would then stop growing. The only way to increase the amount of warming from methane is to increase the annual emissions rate. Not so with carbon dioxide, which acts more like a bank account with a zero interest rate ... A fixed emission-rate of carbon dioxide accumulates in the atmosphere, leading to warming that grows without bounds over time.

In fact, if warming causes the land ecosystems to start releasing rather than storing carbon, it would be as if your bank account had a positive interest rate. Not a bad thing for a real bank account, but bad news for climate if it is carbon dioxide you are banking.

Nevertheless, the global-warming impact of methane is strong while it is in the atmosphere, as it is 75 times more potent a GHG than CO2 and as such can have a strong influence on climate change. It is estimated that livestock may have contributed 20 per cent of the global warming the Earth has experienced since the Industrial Revolution, or about 0.16 °C of the 0.8 °C increase.7

If as is projected there is a significant growth in livestock-based agriculture without a commensurate reduction in the GHG produced by the sector, levels will not stabilise and will continue to contribute to global warming. However, the simplistic view that livestock should be replaced by plant-based agriculture because of a lower carbon footprint may not be correct when balanced nutrition, consumer choice and carbon sequestration by soil are taken into account.

New Zealand's climate commitments

The Paris Agreement commits both developed and developing countries alike to the goal of limiting global temperature increase well below 2°C through nationally determined contributions (NDCs), and obliges countries to pursue domestic measures aimed at achieving the NDCs. The Paris Agreement also reaffirms the binding obligations of developed countries under the UN Framework Convention on Climate Change (UNFCCC) to support the efforts of developing countries and calls for a new mechanism to enable emission reductions in one country to be counted toward another country’s NDC. Such a concept could be of major significance to New Zealand given its leading position as a dairy exporter and the relative efficiency of New Zealand’s pasture-based milk production with respect to GHG emissions.

At the time of writing, 128 parties had ratified out of the 197 parties to the Convention. The impact of the new US president — a climate-change sceptic — on the agreement or on global action to curb GHG emissions has yet to be determined. However, New Zealand ratified the Paris Agreement on 4 October 2016. The new post-2020 target is equivalent to around 11 per cent below 1990 levels by 2030: New Zealand will meet this target through a mix of domestic emission reductions, the removal of CO2 by forests and participation in international carbon markets. New Zealand’s intended NDC (INDC) can be found on the UNFCCC website:

New Zealand commits to reduce GHG emissions to 30% below 2005 levels by 2030.

New Zealand’s INDC will remain provisional pending confirmation of the approaches to be taken in accounting for the land sector, and confirmation of access to carbon markets. New Zealand will participate actively in discussions on the land sector with our negotiating partners, both in the lead-up to and after COP 21, and will confirm details of the accounting approach we will take prior to or upon ratification of the Paris Agreement. In order to achieve domestic reductions and to do so at an affordable cost, we have identified a need for cost-effective mitigation technology, and in particular that our continuing investment in agricultural research delivers results that can be commercialised within the time period covered by this contribution.

In New Zealand, agriculture accounts for 49 per cent of total GHG emissions, with dairy almost half of that. New Zealand has some of the highest national GHG emission contributions from agriculture and dairy in the world. By way of comparison, Ireland is one of the next highest, with 30 per cent and 10 per cent coming from agriculture and dairy respectively. In Australia and the UK, the contribution from dairy is approximately one-eighth that of New Zealand. New Zealand agricultural emissions are four times the 12 per cent average for developed countries.

Using the publically available information on emissions from the UNFCCC and industry milk production data, emissions intensities, expressed in CO2 equivalents (CH4 = 25; N2O = 298) for Ireland, the Netherlands, New Zealand and the US were calculated and are presented in Table 1. For India and Chile information on the emissions intensity estimated for CH4 only is also presented.

—    Emissions from the dairy sector are reported differently in the Netherlands than in Ireland, New Zealand and the USA, as emissions from replacement dairy animals are not reported separately to emissions from beef animals; 80 per cent of the emissions from a combined category ‘Young cattle’ have been added to those reported for ‘Mature dairy cattle’ based on the fact that close to half of these ‘Young cattle’ are reared for veal and slaughtered at an early age. This makes emissions from the dairy sector in the Netherlands far more uncertain than in the other three countries.

Country Dairy emissions
(Gt CO2 eq)
GHG intensity
(Kg CO2e/kg energy corrected milk,
inventory approach)
New Zealand (2012) 15,911 0.67
Ireland (2012) 4569 0.86
USA (2012) 75,067 0.87
The Netherlands (2012) 9925 0.78
India (2007) 171,418 (methane only) 1.48 (methane only)
Chile (2010) 1538 (methane only) 0.64 (methane only)

Table 1. Comparison of dairy emissions.

—   Some on-farm emissions are excluded, notably emissions from nitrogen fertiliser applications. Including these emissions could alter the relative ranking.

—   Different methodologies are used by each country, and, although these methodologies should be those most appropriate for the country concerned, national inventories are at different stages of development. New Zealand has invested heavily in the development of a sophisticated national agricultural inventory simply because agriculture plays such an important role in the economy and emissions profile: these comparisons are therefore simply a snapshot in time and comparisons could change as inventory methods change.

Figure 1. Changes in GHG emissions, 1990–2013.

GHG emissions from agriculture contribute to New Zealand having one of the highest per capita emissions in the world at 17.2 tonnes CO2 equivalent, which is 1.5 times the global average. Between 1990 and 2013 agricultural emissions increased by 14 per cent. At +42.4 per cent, New Zealand also had one of the highest increases to emissions from land use, land-use change and forestry between 1990 and 2013 compared with Ireland at +2.3 per cent, Australia at +1.2 per cent and the UK at –29.7 per cent over the same period (see Figure 1).8

New Zealand has fewer low-cost options to reduce GHG emissions than most other developed countries. Failure to tackle dairy and other agricultural GHG could compromise New Zealand’s ability to meet its NDC, resulting in the requirement to offset any shortfall through purchase of carbon credits.

Looking at these figures in isolation, it is possible to draw the conclusion that in New Zealand agriculture — and particularly dairying — is a climate villain and that our dairying is making a disproportionate and inappropriate relative contribution to global warming.

Producing food for others needs to be accounted for

However, Table 2 paints a different picture and in part provides an explanation for why dairy makes such a significant contribution to New Zealand emissions compared to other countries. Put simply, New Zealand produces a large amount of milk relative to the size of the population — approximately 90 per cent of dairy emissions are associated with consumption of that dairy in other countries.

Improvements in cow and plant genetics, pasture management and other farming practices has resulted in significant improvements to the GHG emission intensity of milk and meat production in New Zealand. GHG emissions per unit of production have decreased on average by 1 per cent per year since 1990.9

Comparing GHG emission intensity across countries is not a simple exercise, but at 0.67 kg/energy corrected milk, New Zealand dairy-based GHG emissions are at world-best levels on an intensity basis. It is difficult to state that New Zealand is significantly superior to a number of other countries with developed dairy chains because of the inherent difficulty in producing accurate average figures as a result of the variability of individual farm GHG emissions within countries. However, using a different metric, kg CO2 equivalent per kg of milk for a full pre-farm gate life cycle assessment, New Zealand is also at world-best levels.

In 2015, New Zealand kg CO2 equivalent per kg of milk was 0.89 (including land-use change). The global average is 2.4, but there are significant differences in dairy farming practices across countries, ranging from between approximately 1.0 and 7.5 kg CO2 equivalent per kg of milk produced.

Country Population
(billion litres)
Dairy exports
% production)
New Zealand 4.7 5 21 >90
Ireland 4.6 1.2 6 85
Australia 23 1.7 10 45
UK 64 1.9 15 Net importer

Table 2. Comparison of human and cow populations, milk production and dairy exports.

Cross-border trade is an area where New Zealand excels and will be needed for food security to provide a balance for the inevitable troughs in local production caused by seasonal changes, climatic events such as floods and droughts, and disease outbreaks such as foot and mouth disease. New Zealand can never be the ‘food basket’ for the world, but it can help set the standards that facilitate trade and the benchmarks for sustainable, high-quality food production. Nevertheless, New Zealand produces enough milk to provide the equivalent of 500 millilitres of milk per day to over 100 million people, or an extremely relevant 10 per cent of the average recommended dairy intake for the one billion people who are estimated to consume our dairy products.

Why New Zealand dairying is a climate hero

As in most countries, dairy farming is responsible for the majority of our GHG emissions in farm-to-consumer dairy chains, with processing and distribution accounting for approximately 15 per cent of total chain contribution (processing 10 per cent, distribution 5 per cent). As a result, even with relatively long distribution chains, the consumption of milk produced by New Zealand in some export markets — particularly those with developing rather than mature dairy farming systems — can result in a much lower carbon footprint than if that milk had been produced locally. Any policies to reduce national GHG emissions from dairy should be conscious of ‘carbon leakage’ resulting from a compensatory increase in GHG emissions from countries with higher per-litre dairy emissions.

To provide 500 millilitres per day for 10 billion people as part of sustainable diets will require 1.8 trillion litres of milk, or another one trillion litres above what is produced today — which means increased production from both established and developing dairy chains.

With such a need for more milk it is critical that all dairy chains progress to sustainable levels of GHG production. However, what a sustainable level of dairy-related GHG emissions is as part of a holistic, sustainable food system has yet to be determined. Given the modest global impact of New Zealand’s total GHG emissions, the greatest impact we can have on climate change will likely come from development of solutions to curb dairy and agricultural GHG emissions that can be deployed not only in New Zealand but also elsewhere.

In this respect, the development and sharing of new solutions and best practices through such vehicles at the Agricultural Greenhouse Gas Research Centre, Pastoral Greenhouse Gas Research Consortium, Global Research Alliance, Livestock Environmental Assessment Programme and Global Agenda for Sustainable Livestock is important.

Dairy is responsible for 2.7 per cent (4.0 per cent including meat from dairy animals) of global anthropogenic GHG emissions. However, if all dairy producers were as emissions-efficient as New Zealand, the global carbon footprint from dairy would be more than halved.

Meeting the climate-change target and other targets in the SDGs will require all countries to do their bit through their NDCs. However, doing so in the absence of both a national and global perspective of the contributing sectors could result in unintended consequences such as carbon leakage. Such a perspective should consider the contribution of the sector to both costs, such as emissions, and the benefits the sector provides, such as nutrition and livelihoods. It should also look at the longer-term impacts of the sector as part of a sustainable future and, in the case of dairy, a sustainable food system.

In establishing NDCs it is important to look at the contribution of various sectors in both a national and global context. This should be done not just on the single issue relating to the NDC, such as GHG emissions, but in a holistic way that takes into account broader socio­economic and environmental impacts.

Reducing carbon emissions by reducing dairy production would contribute to New Zealand meeting its NDC under the Paris Agreement, but would also result in an increase in global GHG emissions if that milk were to be replaced by more emissions-intensive production elsewhere. With New Zealand responsible for less than three per cent of global milk production, and the global dairy sector responsible for less than three per cent of total GHG emissions, any reduction of emissions from our dairy sector will have negligible impact on global warming.

But New Zealand can take a lead in helping to develop globally deployable solutions to dairy and livestock emissions. Such solutions will be critical, as a reduction in global milk production would likely result in a failure to achieve the SDGs.

Taking account of the importance of dairying to the SDGs and the relative performance of the New Zealand dairy sector, there is a strong argument that pasture-based dairying in New Zealand is in fact a climate hero. But, like many heroes, it is not without flaws and imperfections and the need for development and improvement.





4. J. P. Hill, ‘Assessing the Overall Impact of Dairy Farming’, in Achieving Sustainable Production of Milk — Vol. 2: Safety, Quality and Sustainability, edited by N. van Belzen (Oxford: Burleigh Dodds Science Publishing, in press).

5. M. Perignon, F. Vieux, L-G. Soler, G. Masset and N. Darmon, ‘Improving Diet Sustainability Through Evolution of Food Choices: Review of Epidemiological Studies on the Environmental Impacts of Diets’, Nutritional Reviews 75 (2017): 2–17. doi:10.1093/nutrit/nuw043.

6. M. Springmann, D. Mason-D’Croz, S. Robinson, K. Wiebe, H. C. J. Godfray, M. Rayner and P. Scarborough, ‘Mitigation Potential and Global Health Impacts from Emissions Pricing of Food Commodities’, Nature Climate Change 7 (2017): 69–74. doi:10.1038/NCLIMATE3155.

7. Harry Clark, personal communication.

8. National greenhouse gas inventory data for period 1990–2013. Available at: 8812.php.

9. ‘Reducing New Zealand’s Agricultural Greenhouse Gas Emissions: How We Are Getting There’ (New Zealand Agricultural Greenhouse Gas Research Centre and Pastoral Greenhouse Gas Research Consortium, 2014).

Jeremy Hill is the chief science and technology officer at Fonterra Co-operative Group. This article is an essay in Massey University's 2017 New Zealand Land & Food Annual - No free lunch. It is reposted here with permission. The New Zealand Land & Food Annual 2017, Edited by Claire Massey, published by Massey University Press, RRP: $39.99, available in bookshops nationwide.

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Reduce freedom camping cow numbers by 80% from 5m to 1m, and Dairying will be even more of a hero! Why is that so hard?


Because doing that would kill the planet and we don't want to kill the planet. Decreasing cow numbers here would incentivise an increase of cows elsewhere and that would create more planet killing GHG than currently produced.


I am often a Fonterra -basher , ( I resent paying so much for milk) but you have got to hand it to them , its a mighty efficient machine on top of a world -class industry .

We would be poorer without Fonterra as would Australia be poorer without BHP (which also cops a lot more flack )

When you look at it Kiwis were known for no 8 wire , but today are now better known for excellence in their chosen fields be it dairy farming , sailing fast yachts or playing rugby .

Whether we refer to Adam Smith or Ricardo , New Zealand is a textbook example of the comparative advantage of Nations theory at work


The point being what? That the poor old tax payer funds the farmers share of the carbon scheme (never minds the farmers hold more wealth than tax payer joe can ever hope for...but joe can pay huh?) ...or you want to opt out like Mr trump and keep on pumping co2? Or an attempt to justify business as issue?


Fonterra's Jeremy.... you lost me right there.


NZ's Dairy emissions of CO2 measured scientifically are about half the published figures which are measured on a gross basis - Thanks to them Minister Nick Smith - and totally ignore the massive CO2 absorption from our grass and crop lands used in agricultural production.


Exactly. Is there a way for Gross emissions to be our model ?


Issue is that Agricultural emissions are such a large % of our total emissions - Agriculture is a huge % of industry vs other countries and we are already 80 - 90 % renewables in our Power generation with zero emissions.

Thus Agriculture vs other countries looks to be a big % of our total emissions and " demands " intervention !

If we are ever thinking of an ETS on agriculture - which would require borrowing offshore ( We are already running a current account deficit ) to purchase credits to offset non existent emissions - then that would have to fall into one of the dumbest initiatives ever.

So we need to measure net not gross.


I don't really understand these emissions calculations, but all i am hearing is total emissions numbers.I would be interested to know what percentage methane to nett oxygen a farm would emit. My guess would be this number would be very low.


All emissions are calculated on the basis of CO2 equivalents on a gross basis.

So smaller volumes of Methane with larger warming potential have a greater impact.

A " weighted average " if you will on warming potential.

But at no stage do we deduct off the CO 2 absorbed as inputs to this production - so we end up dramatically overstating our emissions.


Others are doing worse is a poor metric.


Jeremy, you state New Zealand kg CO2 equivalent per kg of milk was 0.89 (including land-use change), while the global average is 2.4. Do you have a link to the paper / data backing this up? Thanks!