Guy Trafford points out that political assumptions about the value of cropping and forestry and the threat of livestock farming may not have a scientific basis, resulting in flawed policy rules and counterproductive gaming

Guy Trafford points out that political assumptions about the value of cropping and forestry and the threat of livestock farming may not have a scientific basis, resulting in flawed policy rules and counterproductive gaming

The news this week that New Zealand is having to import wheat from countries other than Australia is the first major indication that climate change extremes are going to start to hurt consumers in the pocket.

Up until recently (the exception being when Countdown began to start purchasing wheat from within New Zealand), New Zealand has imported the vast bulk of its milling wheat from Australia. Unfortunately, “the lucky country’s” wheat growing areas have experience the worst drought on record. With production down around 20% not only has this meant that there is not enough of a surplus to meet New Zealand’s needs, but Australia itself is having to import wheat from Canada to meet its own requirements.

On this side of the Tasman bread prices are predicted to be (only) going up by 2-3% however, in Australia the rise is predicted to be over 20% per loaf.

An irony here is the latest election has brought in a status quo Australian government who have not made any major commitments to addressing climate change. Given they have been in an extreme climate situation for several years it shows how difficult it is going to be get wholesale buy-in to meaningful polices that require wide ranging sacrifice. One Australian commentator said voters “were more fearful of climate policies than climate change”, a view the rural sector over there appeared to have adopted. Possibly, this is a motivation to why the New Zealand Labour-led coalition is making hay while it can.

Higher penalties

This week it has announced greater penalties being applied to those emitters who have failed to correctly meet obligations.

And this week the price of carbon passed through the NZ$25 cap ($25.37) with many predicting it is going to rise considerably even though full compliance is several years away. There is also talk of a (high) minimum floor price to keep pressure on emitters.

Gaming the regulations

There has been considerable ‘noise’ coming from the more remote farming districts about the increasing number of farms being sold to overseas owners. The Oversea Investment Act  (2018) expressly allows overseas investors to purchase properties less than 1,000 hectares and not apply any additional benefit to New Zealand. This means overseas investors are competing head to head with Mum and Dad Kiwi farmers, it also means that likely better farms, i.e.  easier contoured farms capable of higher productivity, are being converted as these ‘smaller farms’ tend to have better land as otherwise they would have ‘failed’ due to being uneconomic years ago.

Farming subsidies

The Gisborne/East Coast region saw the negative impacts after Cyclone Bola and the back-country areas never recovered and ‘good’ farms were converted along with steeper eroding ones as farmers did not like only having trees for neighbours and seeing rural facilities (rapidly in that case) disappearing. The trend to planting the more isolated areas in trees may well meet the government targets but given farmers are not able to use trees to off set methane emission they may need greater incentives to plant their gullies. At the moment these subsidies are available to overseas and domestic landowners alike and make those who wish to convert farms having a relatively cheap option especially when our NZ$ is compared to major overseas currencies. With subsidies of up to $4,000 per hectare for up to 300ha for indigenous plantings and up to $1,500 for exotic plantation planting getting into forestry must look a sound investment.

Where the carbon is stored

Another of life’s ironies is that there is increasing evidence that there is more carbon stored in soils under pasture than there is under forestry, and this comes from the Pastoral Greenhouse Gas Research Consortium (PGgRc).

It is bad policy to ignore the scientific evidence

Coming back to the wheat issue, New Zealand perhaps surprising to some, currently holds both the yield records for wheat and barley but as our costs of production have been considerably higher than Australia with their ‘broad acre’ approach hence why it has been favoured as a source. The weather can also create difficulties in New Zealand especially around harvest and planting times with too much moisture being the potential problem.

Those who see a switch to grains as, at least partially, solving some of New Zealand’s GHG and nitrate problems may be right if crops replace livestock. However, nothing is ever quite that simple. Arable crops, while perhaps having some benefits providing the demand is there, also do have some draw backs. Nitrate leaching from arable crops are still considerable and higher than some livestock/pasture systems and if and when soil carbon is taken into account (which is a shameful omission at the moment) shows that emissions from cropped soils are higher than pastoral systems. Which all goes to prove that the whole topic is complicated and full of uncertainties especially around agriculture.

So, when Shane Jones gets on his hobby horse and starts criticising farmers for “bitching and moaning” about the latest policy while other sectors i.e. tourism don’t rate a mention and there is a lack of agreement on some of the science, he needs to take a cold shower and back off. Farmers generally have brought into the climate change debate well; we haven’t seen tractors driven to Parliament or roads blocked like what would occur in France if they were inflicted with the constant ratcheting up of regulations and compliance.

What farmers here don’t like is being singled out and having ill thought through policies rammed down their throats and then expected to be grateful for them.

A final interesting (perhaps) observation this week was seeing a paddock of pasture being made into baleage and a paddock of new grass elsewhere being irrigated.

P2 Steer

Select chart tabs »

The 'NZ average' chart will be drawn here.
Loading...
cents/kg
The 'NI average' chart will be drawn here.
Loading...
cents/kg
The 'SI average' chart will be drawn here.
Loading...
cents/kg

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

36 Comments

Comment Filter

Highlight new comments in the last hr(s).

up to $4,000 per hectare for up to 300ha for indigenous plantings.

That's a great incentive - glad to see it.
$1,800/ha for manuka/kanuka and $1,000/ha for reversion as well;

https://www.mpi.govt.nz/funding-and-programmes/forestry/planting-one-bil...

They do require a whole lot more expertise and tending to get them established. I wonder if payment of the subsidy is divided into parts/stages?

Found the answer;
https://www.mpi.govt.nz/funding-and-programmes/forestry/erosion-control-...

Again, very viable - 50% with proof of trees on order, and another 30% when planted. Hope the growers are gearing up!

I don't see the $4000 anywhere. Where's a cheap place to source the plants?

Transfer of wealth from fuel users to the landed gentry. "But charming technocrats at the United Nations in New York is no substitute for dealing with the plight of the working poor in suburban South Auckland; the very people who helped elect this government are now bleeding through their skinny wallets."
https://www.stuff.co.nz/business/107767980/fuel-taxes-are-regressive-dev...

There is a lot of irrigated land in Australia that could grow wheat, but grows cotton because they get more , but uses 10 times more water per ha.
https://www.theguardian.com/australia-news/2019/jan/31/photos-reveal-que...

Guy with the agri sector being pushed from pillar to post by the current coalition makes discussion about a well-being budget just plain one sided nonsense

If we can get past entrenched ideology, Westminster?

The agri sector, as currently formatted, is unsustainable. It will therefore cease to continue. Blame won't change that an awful lot (though I realise it makes you feel better).

Oddly enough, it is cities which are the more entropic, unsustainable entities - they require outside resources including food. If you take the actual ecological footprint of London, for instance, it requires the whole area of the British Isles. Leaving no acreage for every other inhabitant (they are beong supported by 'others somewhere else' plus resource draw-down (also unsustainable).

To become sustainable, we need to talk about regeneration - the circularisation of resources (like phosphorous, for instance). Eventually, we need to be looking at returning the organic waste from cities, to farmland. This is irrespective of budgets, wealth, incomes, tax or anything else. We simply have to do it or we will cease to exist in the numbers we do, in the comfort we enjoy.

Well-being is an important step in the journey, in that 'economic growth' was trashing the planet. Whether it is too late, is an interesting question, but correct it is.

What is an individual farmer and his family expected to do to save the planet , sell his livestock, plant trees ,then dismiss staff if any and declare bankruptcy ? On a mass scale the service sector & banks also declare bankruptcy.
Their needs some reality checks in the debate as sending one sector to the wall is not an option that will get traction

You raise a valid argument - we are all part of an unsustainable system, most folk rely on it for their 'income' and nobody wants to exit first. And we all did it by tapping into underground energy resources - a one off. They were like extra acres, millions of sunlit acre-years, which we won't have in the future. It is almost certain that our financial arrangement won't survive to zero growth either - all the forward bets can't be honoured.

I suspect we'll end up without tourism, virtually without global trade and running on renewables. Which suggests farming will get smaller, more bio-diverse, more labour-intensive and more pressured to be within near proximity of cities.

Just how we reward food-producers in that scenario is something my type have given much though - we reckon food-production will be the most in-demand service, period, but what you'll be paid for/with? Societally, we have to get rid of the debt, because it's a forward demand - a demand on future resource draw-down which cannot be redeemed. Steve Keen is one of the few economists (Herman Daly is a standout other) who are thinking about this. Lots of future-food comment here:
https://www.resilience.org/
I don't agree with every comment there, but I've never read one item that didn't make me think.

Shane Jones comments seem to be made out of frustration that his regional fund is failing, and they surely work against the political advantage he looked for in setting it up. There seems to be a real lost opportunity here. Farmers have been remarkably receptive to dealing with climate change, considering what they have to lose, and in comparison to similar groups around the world. Surely we should be building on that and thinking hard about the complexities of climate change and working on equitable solutions. Sledgehammer tactics are not working as evidenced in Australia, the US and even France.

16
up

Tourism burns vast amounts of carbon. Takes a lot of fuel to get even one person into New Zealand.

14
up

You are mentioning the unmentionable.

Great contribution Guy. In the soil science area it's been well known for a long time that soil carbon levels under pasture are much higher than under NZ indigenous or exotic forest.
Interesting here in Timor Leste where phosphate or nitrogenous fertilisers are very little used, particularly in the mountain areas, where 80%+ of the population lives, and agriculture is low intensity, organic, subsistence. Increasing soil organic carbon (SOC) is a high priority both for increasing productivity and remediating soil degradation. There are differences in climate, topography and soil geology between Timor Leste and New Zealand but the basics of soil management remain constant.
Reducing inputs of urea and superphosphate along with envigorating soil biological function can lead to massive gains in SOC and soil nutrient availability to plants.

Your statement that soil carbon levels under pasture are much higher than under NZ indigenous or exotic forest makes no sense to me.
Unless, some of the ash carbon from the original slash and burn was retained?
Permanent pasture is a relatively stable store for soil carbon so long as there is no erosion (which is unlikely).
Continuous forestry will gradually increase soil carbon.

My understanding (limited maybe) is that is simply not true. Although our forests held large amounts of carbon it was mostly in growing vegetation with a regenerating forest quickly in geologic time scales reaching equilibrium. Grasslands on the other hand have a tendency to continuously sequester carbon the best examples being the likes of the Midwest US soils being metres deep with humus. Generalisations it's tree but basically correct.

Something of a dog's breakfast. Stupid, repressive policy based on absolutist, authoritarian intent, dressed up as nice sounding aspiration. Classic failure of Central Planning, eh, comrade. Stalin would be proud of it, enjoying watching useful idiots deliver power into his hands.

I wonder what form the backlash will take, and who will be our Farage. I don't see him or her as yet, but there is a backlash building worldwide against consensus politics, on the basis that it favours the politicians not the populace, so expect a new face to appear...

Our Farage?? Do you actually yearn for someone like THAT?

"....first major indication that climate change extremes are going to start to hurt consumers in the pocket." Preferably worded as "climate extremes" and left out the change. One doesn't need external forces to hit consumers in the pocket. Labour governments always look for an excuse to apply additional taxes with a carbon tax no exception. We have a new religion and its called anthropomorphic climate change with Al Gore as the perhaps the Pope, James Shaw as an ArchBishop and Jacinda Ardern as a high priestess.

No - we had a religion, peddling horsepoo. It had a Holy Grail (GDP), it had High Priests (economists) and Parish tithe-hooverers (banks).

But it's been exposed as a crock - although the MSM (businesses, and therefore vested-interests to a large degree) are doing a credible impression of pretending it isn't happening. Essentially we were running a one-way extraction-consumption-excretion process and had ramped it up to planet-altering rates. CC is only the exhaust symptom - it's the burning, the depletion and the problem of replacement is the bigger problem.

I'm guessing your argument is based on self-justification? One can usually trace such.

Guy
"The Overseas Investment Act (2018) expressly allows overseas investors to purchase properties less than 1,000 hectares and not apply any additional benefit to New Zealand."
With the explicit proviso that it is used for forestry.
KeithW

Guy
Australian wheat production has always been highly variable. This last year it was 17.3 million tonnes. Go back to 2006 and it was 10.8 million tonnes. In 2016 it was 31.8 million tonnes.
There is no statistical evidence to date that yield variability has increased. For example in 2002 it was 10.1 million tonnes and then the next year it was a record (to that time) of 26.1 million tonnes.
It will be another couple of months before we get a reasonable estimate of the coming season, with the biggest drive being rainfall over that time in New South Wales.
Exports in the current year (from last year's crop) will end up around 10 million tonnes. It seems that the crop has been a little oversold and hence the need for imports to get through to the next harvest starting in October.
KeithW

Exactly, Keith. WA's wheatbelt has had a good year, and the Bureau of Ag and Water Resources (ABARES) notes that:

While forecast winter crop production in 2018–19 is 20% below the 20 year average to 2017–18, it is 69% above the lowest production during this period.This is because exceptionally unfavourable seasonal conditions in 2018–19 affected less cropping area than during droughts in 1994–95, 2002–03, 2006–07 and 2007–08.Winter crop production in Western Australia is expected to account for 56% of national production in 2018–19,compared with an average level of 36% in the 20 years to 2017–18.

I am fundamentally leery of the tendency to alarmist comment and Chicken Little prognostications in articles like this. Sure, it's a dip. But Gaia is a notoriously fickle wench, and us humans have always just had to cope with whatever she throws at us. Que sera, sera.....

I don’t see changing suppliers affects costs as I assume we buy on an open market, perhaps some increase freight costs.
The Russians are having a good year for wheat, they may do us a good deal.

Re para. titled 'Where carbon is stored' - please provide specific reference within PCGGRC docs that back up the claim that there is more carbon in pasture soils than forestry soils?

Found it: p. 6: In New Zealand, it also seems
that there is more carbon in soil
under pasture than under forests.
Possible contributing factors
include more root inputs (more
carbon exuding into the soil), more
root turnover (more dead plant
matter rotting in the soil).

The other irony is that higher carbon levels in the air help plants grow in dryer climates as plants need less stomata which also means less water loss.

The planet is actually greening in dryer climates right now due to increased CO2,

https://www.nasa.gov/feature/goddard/2016/carbon-dioxide-fertilization-g...

Changing government is going to fix the drought, now there's an election promise if ever I saw one!

The Aussie voter knows about the pre SUV Federation Drought so can put things into perspective. Wheat production down 20% vs. "In 1892 Australia had 106 million sheep, two-thirds of which were in the eastern states. By 1903 the national flock had almost halved to 54 million. The nation lost more than 40 per cent of its cattle over the same period, nearly three million in Queensland alone."
If a 20% drop in wheat production is "extreme" then what superlative do you use for the Federation Drought?

Drought is in fact the least likely result of the climate heating up. Less ice caps / more heat means more water vapour rain etc. Ice ages were characterised by extreme dry and large amounts of dust.

From now on, any weather event shall be blamed on global warming. The warmest May in 20 years is a sure sign the earth is on fire.

In the Australian Election, comments were made that "farmers are more fearful of climate policies then climate change". All New Zealanders should be saying the same thing and not bowing to this nonsense. Our 0.17% contribution to global man-made greenhouse gas emissions is to small to measure!

even your 'too' is smaller than most.

It years to come we will look back at this whole carbon catastrophe and laugh at how stupid we were. It wont be the first time

we used to believe the world was flat
we used to believe that the sun orbited the earth
we used to think a Y2K computer bug would cripple the world
we used to believe in the tooth fairy, santa clause and some Aussie footballer believes in a God
Remember power bands https://en.wikipedia.org/wiki/Power_Balance

These days people think CO2 is bad in a carbon based world. CO2 feeds plants and phytoplankin and they convert it to sugars (CARBohydrates), and that is what feeds all life on earth...

The Milankovitch cycle is due to head cooler arfter this warm period and nothing can stop that from happening

We used to believe that unfettered economic growth was possible on a finite planet.

One of the best things you can do to improve your health is to stop eating wheat altogether. Nearly all the wheat in the world is just converted into human fat.