Changing global trade ties
OPINION: I recently returned from a market visit overseas, including the United Kingdom and Europe. These are critical, historically important and increasingly high value markets for our red meat exports.
What became clear as a result of that letter was that farmers were largely unaware of the financial impacts of the recommendations, the inequity of the outcomes and the huge sacrifices that they were being signed up to by industry leaders on their behalf.
Feedback from many who had participated in the initial “consultation” process revealed that far from being a genuine opportunity to engage and respond, the process effectively shut down any scope for wider discussion, gave farmers limited and narrow data and restricted the ability to open the door to greater understanding.
To be absolutely clear – sheep and beef farmers were not consulted on the substantive recommendations that went to government on their behalf nor were they given access to the depth of data which revealed the true impacts on their businesses.
On October 11 the Prime Minister made the announcement that the proposal put forward by industry was, by and large, being accepted. Split gas – tick. No ETS-tick. In a refreshingly transparent way, the PM also highlighted the financial and social impacts on sheep, beef and deer farmers – their own modelling revealing a likely 20% plus exodus forced from the sector.
Given that the modelling released by BLNZ after consultation showed a similar level of potential impact, we are now finding it hard to understand why the levy bodies are responding so negatively to the government proposal. In reality, the partners to the HWEN proposal made a conscious decision to sacrifice sheep and beef farmers and their communities to create the offset for more intensive farming to continue and this has now been exposed.
Farmers are now hearing from levy organisations that they cannot agree with the way the price is to be set. In both proposals the Minister has the final say. And both methods use farming businesses as a pawn – cranking the lever (price) one way or another to drive farmers to “change behaviour”.
The real issue here is that there are currently no viable mitigations to reduce our methane emissions apart from reduce stock numbers so the only way to reduce emissions is to crank up the price until enough of us do this or go out of business. It is a cruel and tortuous system. Extensive and low input farm systems simply do not generate the profitability needed to simply just pay the tax - so it will be these farm communities who become collateral damage.
Farmers are currently hearing about how critical sequestration is as part of the HWEN recommendations. Let us be clear. The narrow criteria allowed for sequestration within HWEN means that much of the woody vegetation that currently exists on farms will largely be ineligible. This is despite the fact that when farmers in good faith dutifully rolled along to the “Know Your Numbers” events and were told to include all the woody vegetation currently on their farms, much of what they had included was in fact not an offset at all. In short, the level of planting required to offset emissions using sequestration as the tool will far outstrip the ability of farmers to pay for it.
As a sector we now find ourselves in a huge mess. On farm, morale is low and there is real despondency in the hills where thousands of hectares of land are being sold for trees. There is no real sense from farmers that there is the ability to aspire to and achieve something better.
Following our Open letter in August industry leadership challenged us to come up with an alternative – a model which would achieve the core principles of the HWEN partnership and deliver better outcomes for all farmers. Ignoring the fact that this was what our industry bodies should have done, we accepted that challenge and designed a pricing model which could achieve the goals of HWEN, is fair and equitable, would fulfil our obligations, would not rely on subsidies or welfare from New Zealand Inc. and is simple to administer. Whilst not perfect, it is poles apart from the original both in design and in outcomes and shows that something better could be possible. Sheep and beef farming could have a future.
And we encourage our fellow farmers to urgently engage and challenge your representatives on finding a more viable option. The future of sheep and beef farming depends on it.
Written by Graeme Gleeson, Rick Burke, Jane Smith, Simon Hales, Ben Ensor, Mike Cranstone, Roger Dalrymple, Kirsten Bryant, Jason Barrier, Kerry Worsnop
