Ministers tackle various issues overseas while Kiri Allan extends the Human Rights Act to combat religious bigots in NZ

 Buzz from the Beehive

Two ministers are overseas, combating climate  change (in the case of James Shaw) and Russian invaders  (in the case of Defence Minister Peeni Henare).

Another minister is bound for Paris, to combat mental ill-health among other things, according to his press statement.

And back home, Justice Minister Kiri Allan is combating religious discrimination.

We learn this from the Beehive website, where the latest posts tell us our ministers are –

Warning it is crunch time to take domestic action on climate change

Climate Change Minister James Shaw marked the end of COP27 negotiations in Egypt by saying it is crunch time for counties to step up and take urgent action at home. Continue reading “Ministers tackle various issues overseas while Kiri Allan extends the Human Rights Act to combat religious bigots in NZ”

Film Commission’s leading lady becomes a leading bloke – but questions remain about some others in the cast

Latest from the Beehive

There is news for the farm sector, which is anxious to be spared from full exposure to the country’s emissions trading scheme, and the film industry, which is anxious to hold on to its heavy state subsidies and tax breaks, on the Beehive website today.

The news for the farm sector was that the Government has welcomed advice from the Climate Change Commission assessing readiness in the agricultural sector for an emissions pricing system.

A report from the commission considers the He Waka Eke Noa partnership proposal provided to Ministers at the end of May, which recommended the introduction of a farm-level levy system from 2025 with separate prices for short and long-lived gases.

Ministers are required to provide a public report on what an alternative pricing mechanism for agriculture could look like by the end of 2022.

The Climate Change Commission report is available here: Agricultural Progress Assessment » Climate Change Commission ( Continue reading “Film Commission’s leading lady becomes a leading bloke – but questions remain about some others in the cast”

Worrying external deficit should give Govt cause to shy away from calls to cull the country’s dairy herd

Even  though NZ  is  reaping record prices for  its  primary exports, the  country’s current  account deficit  “exploded”  (the  BNZ’s  word  for it) in calendar  year 2021  to  the  equivalent  of  5.8% of  GDP,  or  $20bn. The  previous  year  the  annual deficit had been only  0.8%  of  GDP.

Economist  Cameron Bagrie  said  the current account deficit didn’t  get the  attention  it  deserved. The  BNZ’s  economists, noting there had been  a  very  big change in a  short  space  of time, said the deficit   is  the  largest   since 2009.

“It continues a rapid widening of the external deficit that we have been warning of for quite some time. The deficit is now getting to a level that some in the market and/or rating agencies might start paying attention to.”

Whether  the  government, preoccupied  with Covid  and  rising inflation, is  paying   any attention  isn’t clear — but  it  should be.  Some insiders  believe it is  beavering  away  on climate change  measures  that could have a  damaging effect on  farming  morale—particularly if the government goes  ahead with  measures as  proposed  by the Climate Change Commission to reduce  methane emissions  by  cutting cow herds by  15%.

Because informed  predictions suggest the current  account deficit could  grow even  larger,  NZ  will  need  every tonne  of exports  it  can find. Continue reading “Worrying external deficit should give Govt cause to shy away from calls to cull the country’s dairy herd”

NZ’s economic outlook is given a lift as dairy prices rise again

Dairy prices have  hit  a  new  peak at  Fonterra’s Global Dairy Trade  auction.  The GDT index shot up 5.1% to an average price of US$5,065 (NZ$7,509). Whole milk powder rose 5.7% to US$4,757 a tonne while cheddar rocketed up 10.9% to $6,394.

Butter prices gained 5.9% to an average US$7086/tonne, anhydrous milk fat 2.1% to US$7048/tonne and butter milk powder firmed 5.8% to US$4217/tonne. Skim milk  powder was  up 4.7% to US$4481/ tonne.

“This train isn’t slowing down,” said NZX dairy insights manager Stuart Davison.

Other  business-sector commentators  see  the  boom in the dairy  sector   injecting  new  strength into  the  economy at a  time  when it is badly  needed, with  other sectors  like international tourism  and  hospitality hard hit  by the Covid pandemic.

Bidding at  the  auction was  fierce, driven by the  tight supply   position,  as well  as  Russia’s war  on Ukraine. Continue reading “NZ’s economic outlook is given a lift as dairy prices rise again”

Hard on the heels of support for democracy in Hong Kong, Mahuta welcomes acceptance of New Caledonia governance vote

Just as we were encouraged yesterday by Nanaia Mahuta’s railing against the undermining of the democratic electoral system in Hong Kong, today we are encouraged by her acceptance of a referendum outcome in New Caledonia.  

Mind you, there is nothing like the Treaty of Waitangi in Hong Kong or New Caledonia to temper her zeal for good democratic processes.     

In today’s waving of the flag for democracy, Foreign Affairs Minister Mahuta has welcomed the fact the referendum process to determine the future status of New Caledonia had been calm and secure.

“We support the right of all peoples to self-determination, as expressed under international law,” Nanaia Mahuta said.

And when a majority of voters have determined what should happen?

Mahuta says the people then should live with the result

“Aotearoa New Zealand now encourages all parties to participate peacefully and constructively in the post-referendum transition process in the spirit of the Nouméa Accord.” Continue reading “Hard on the heels of support for democracy in Hong Kong, Mahuta welcomes acceptance of New Caledonia governance vote”

NZ dairy industry’s biggest challenge is meeting methane gas emission targets

New Zealand dairy farmers are some of the most efficient producers of dairy milk in the world, and while the past year has been tough for many industries, the overall picture for dairy has been overwhelmingly positive.  Returns to farmers have been at record levels,. along with the economic contribution to NZ.

Dairy  export receipts are  nudging $20bn  a  year, up  from $4.58m  in 2000.

But  now  the  industry  is  facing  its biggest  challenge.

Dairy  cattle are  responsible  for  22% of  NZ’s emissions. Can  NZ  meets  its methane  emission  targets  without  slashing  the   size of the  national  dairy  herd?

The  threat of  global warming  has  become all too plain  to  New Zealanders  in recent weeks and the pressure  on   the  government to  act  is  mounting.

It  can’t   dodge  making  decisions  on  the  Climate  Change Commission  report  it  received   earlier this  year. But  its  proposals  could  have  a  severe  impact  on   the  dairy industry. Continue reading “NZ dairy industry’s biggest challenge is meeting methane gas emission targets”

Climate change just got cheaper – or maybe not …

Britain’s fiscal watchdog – the Office of Budget Responsibility (OBR) – has some good news.  It thinks the cost for the UK of getting to zero carbon could be much less than anticipated:  

While unmitigated climate change would spell disaster, the net fiscal costs of moving to net zero emissions by 2050 could be comparatively modest.”

Under its ‘early action scenario’ government net debt would rise by a mere 20% of GDP in the years to 2050 from the current 105%.  That almost seems encouraging when compared with the near-30% of GDP increase responding to the Covid pandemic , and the roughly 50% surge which followed the global financial crisis.

Continue reading “Climate change just got cheaper – or maybe not …”

Yes, we could try to be world-beaters in tackling climate change, but the reason for wanting to set the pace is unclear

Ministers in the Ardern  government  are getting to grips  with  the  Climate Change  Commission report  which,  if  adopted  in  full, will  reshape the  NZ way of life. Some say if all the  recommendations  the  commission  has  framed  are  applied, it will put NZ in the  vanguard  of the  battle  against global warming.

Just  why this country should want to be  among  the  front-runners,  and  possibly  the first,  to  meet  its  commitment  under  the  Paris  agreement to reach zero carbon emissions   by 2050  is  not  exactly  clear.

Nor may  there  be any  deep  conviction  that  the  Ardern government has  the  capacity to deliver  the   most  appropriate  measures  to  meet  its  climate  targets, given  its  long  list  of  policy  failures  including  Kiwi  Build, wiping out homelessness, eliminating child  poverty, and improving mental health, not to  mention the  Covid  vaccination  rollout.

NZ’s CO2 emissions are considerably less than those in the US and Australia (which is among the highest in the world). Transport makes up 33% of NZ’s “long lived” gases. Continue reading “Yes, we could try to be world-beaters in tackling climate change, but the reason for wanting to set the pace is unclear”

The climate-change dilemma facing dairy farmers – milk more cows or cull the herd – is politically challenging, too

From one Wellington  platform  Reserve  Bank governor Adrian  Orr is  telling  the  country   strong global demand for NZ primary products is ensuring the economy remains resilient during the Covid-19 pandemic and is helping offset tourism losses. He  says  Fonterra’s  forecast  of a  record opening milk price is “very good news” and is included in the bank’s projections.

From another platform, Climate Change Commissioner Rod Carr told hundreds of people – including farmers – at an agricultural climate change conference that for the agricultural sector there would be no way to wriggle out of slashing emissions.

Carr said agriculture made up about half of NZ’s emissions, and this needed to be reduced to meet climate obligations.International customers would go elsewhere, costing the economy billions of dollars in the coming years.

So  here’s  the  problem:

Should  dairy  farmers  be  planning to  milk  as  many  cows as  they  can  next season —  or should they be  sending animals to  the  works  to  cut emissions? Continue reading “The climate-change dilemma facing dairy farmers – milk more cows or cull the herd – is politically challenging, too”

The world is keen on our dairy products, which is great for our economy – but what happens when we start culling the cows?

Although  global  trading patterns  are still recovering from the  Covid  pandemic, the  positive  outcome   for  New Zealand   is  that  it  has  strengthened  demand for  the  kind of foodstuffs we produce.

In particular  the   dairy  trade is booming  and  though  the current  production season is beginning to tail off, Fonterra’s latest global dairy auction showed  demand, far  from  falling off, is  still  very  strong,  with  prices  for  whole  milk  powder   51%  higher  than at the  level they were at  this time  last  season.

Dairy products are the country’s largest commodity export and Fonterra estimates milk payments to its 10,000 farmer suppliers for this season would contribute about $11.5 billion to the economy.

The  encouraging  factor   for those  producers  is  that  there  is  every sign  the   high prices  being  earned  at  present  will  be  sustained  into  the  next  season.

Last month, Fonterra raised its forecast milk price for this season to between $7.30 and $7.90 kg/MS, with a mid-point of $7.60.  Some  analysts  are   forecasting $7.70 for this season, ahead of Fonterra’s mid-point.For next season, the  forecasts  range between $7.30   and  $7.50.

While the global dairy trade price index slipped 0.1% from the previous auction a fortnight ago, prices for whole milk powder, which has the most impact on what farmers are paid, gained 0.4% to an average US$4097 (NZ$5713) a tonne.

What  may  be  an irritant  for  the  industry, currency  movements  are  taking  some  of the  gloss  off the  prices  being earned.

With the rising Kiwi currency, the latest auction brought overall prices -2.0% lower in NZ dollars. The key WMP and SMP prices were virtually unchanged in US dollars. The best performer was cheddar cheese, up +1.2% in US dollars but even that was not enough to record a gain in NZD.

The   strong  market  is largely driven by China where a wealthier population and an increased focus on health and wellbeing after the Covid-19 pandemic is stoking demand for better nutrition.

North Asian buyers were back in force, taking up their usual positions as the major buyer.

At the latest auction, 99% of the whole milk powder on offer was sold. There were slight  downward movements  with both of the cream group products. That was  attributed  in part to  the extra volume of butter on offer.

Fonterra  indicated previously it is producing more butter to take  advantage of the  high return for it. That was  sensible,  with butter topping $US5,100  a  tonne.

Given the  outstanding  work  of  the  dairy  industry,  how    will  the  government  react  when  it   comes to   deal  with  the  Climate Change Commission’s  proposal  to  cut  dairy cow  numbers  by  15%?