Ardern government seeks to butter up farmers with bold export forecasts and on-farm sequestration changes

Farmers  had plenty to digest this week:  first, the Ministry of Primary Industries assesses exports from the sector will hit a record high $55bn  in 2023; second, the government took an important step back on the on-farm sequestration programme; and third, Field Days at Mystery Creek engrossed  those who attended (though perhaps not the Prime Minister, given the cool reception).

The MPI data showed Dairy again NZ’s largest export sector with forecast revenue due to top $23.3bn. That underlines how important the dairy sector has become in the NZ economy.  Red meat and wool exports are also expected to hit a record at $12.4bn.

Horticultural export revenue is projected to grow 5% to $7.1bn and processed food by 3% to $3.3bn.

Climate change, farming and (a timely reminder for decision-makers) the Paris Convention’s nod to the need for food

An earlier post  on Point  of  Order about farming and climate change attracted  some interesting  comments.  The  post  itself  contended  that in view of the world  facing  a  global food  shortage the government  should be  doing everything in its power  to lift  food production — and  not  imposing  taxes  on methane  emissions (in  other words  taxing the   burps on animals}.

In the  wake  of  posting our thoughts, Point of  Order  was reminded  that the  Paris  Convention on Climate  Change  in  2015 finished  with an agreement   where Article 2  read with these  key  lines:

Article 2
1. This Agreement, in enhancing the implementation of the Convention,
including its objective, aims to strengthen the global response to the threat of
climate change, in the context of sustainable development and efforts to eradicate poverty, including by :

(b) Increasing the ability to adapt to the adverse impacts of climate
change and foster climate resilience and low greenhouse gas emissions
development, in a manner that does not threaten food production.

Point  of  Order underlines  that last phrase and questions whether that element has  been  fully  considered  in  the  action   which is  now  being  canvassed  in NZ.

He Waka Eke Noa  has delivered its recommendations for pricing agricultural emissions, which in effect will  add  significantly  to the  costs of  food  production.The Government is expected to formally adopt these recommendations in December.

Because He Waka Eke Noa  has  11 partners from the rural industries,  it likely will  be  a  formality   for  the government  to  proceed  with those  recommendations, although the Climate  Change Commission  will have its  own  input   into  what  happens.

Keith Woodford,  a  former  Lincoln College professor, in an article  on the  issue posted by interest.co.nz, noted  the  debate  within HWEN  “went right down to the wire” before Federated Farmers agreed to add their logo.

 “Some of the other partners to the document were also less than happy, but the alternative of failing to come up with an agreement at all was even less palatable.Now it will be up to the Government, taking account of forthcoming advice from the Climate Change Commission (CCC), to make some calls as to the path forward”. 

As  Professor Woodford  put it:

“The Government does not have to accept the HWEN recommendations. Nor does it have to accept the advice of the CCC. But if it does not accept CCC advice, it is required by legislation to give reasons.

“My bet is that there will be robust discussions within Government. There are some within Government, including senior members, who understand very clearly that they must not destroy agriculture. But there are also elements within the Government who are fundamentally antagonistic to New Zealand agriculture as currently structured”.

He says one of the key reasons for antagonism towards New Zealand’s agricultural sector is a serious misunderstanding about the importance of primary industries in general, and pastoral agriculture in particular.

“This lack of understanding is fed by the crazy way that we measure the importance of the agricultural sector in New Zealand. This starts with the measure of GDP, whereby agriculture supposedly makes up in the order of five percent of the economy. 

This GDP measure is limited not only to what happens on-farm, ignoring everything before and past the farm gate, but it also includes only part of what happens on-farm…..The only way to understand the importance to New Zealand of the land-based primary industries is to look at exports. More than 80% of New Zealand’s merchandise exports come from the primary industries”.

Professor  Woodford says the ‘bottom line arising from this situation is that New Zealand has responsibilities to itself, and also to others – through the Paris Agreement – to protect food production.

‘‘However, that does not let New Zealand ‘off the hook’ from having to minimise greenhouse gas emissions whenever it can do so consistent with its food obligations’’.

As Cabinet Ministers  get  to  grips   with the  issue of methane   emissions, Point of Order wonders whether they  will  grasp  all  the  implications  of  what the outcomes  of  their  decisions  will be.   And  will  they understand and  recognise  the  meaning  of the Paris Agreement’s Article 2.1(b)?