Discussion paper outlines carbon farming threat to sheep and beef sector

// Climate Change

Urgent national policy changes are required to ensure the increase in carbon farming to meet New Zealand’s climate change obligations does not come at the expense of the country’s rural communities, according to a discussion paper released today.

Image of a sheep, lamb and cow on farm.

The Green Paper by former Hastings Mayor and MP Lawrence Yule, Managing Forestry Land-Use Under the Influence of Carbon, calls for a more strategic approach to planting trees and outlines policy areas for urgent investigation to address the issue.

It has been released ahead of a workshop next month involving a range of key stakeholders including Forestry Minister Stuart Nash, councils, forestry interests, Beef + Lamb New Zealand (B+LNZ) and Local Government New Zealand.

Mr Yule said the paper outlines the real risk that short-term land-use decisions will be made to the detriment of long-term land-use flexibility, rural communities and export returns.

“Currently, increasing carbon prices in the New Zealand Emissions Trading Scheme (ETS) means carbon farming coupled with plantation forestry is in the short-term significantly more profitable than sheep and beef cattle farming.

“There is little national guidance to help local authorities stop swathes of productive sheep, beef and wool producing farmland being converted to forestry, as the ETS currently allows 100 per cent of fossil fuel emissions to be offset through forestry and councils currently have no available tools to place controls on the planting of trees.”

New Zealand has relied heavily on carbon sequestration through plantation forestry to meet its international obligations to reduce climate emissions, rather than actually reducing gross emissions from all sectors, says Mr Yule.

“While it is widely accepted that changes are needed to maximise opportunities for New Zealand to move to a zero-carbon economy, that does not mean we can simply plant our way out of our climate change obligations.

“New Zealand’s recent history of reducing gross fossil fuel emissions has been poor and there is a risk that the current unconstrained offsetting regime will continue to accelerate highly productive food-producing land going to forestry.

“Recent changes to the ETS averaging rules incentivise carbon-only planting and there is a lack of rules around how permanent carbon farms should be properly managed.”

Mr Yule’s research, funded by Local Government New Zealand, 16 individual councils and B+LNZ identifies options for strategically managing the increased planting required to meet New Zealand’s international commitments to reduce climate emissions.

Sam McIvor, chief executive of B+LNZ, said the research will play an important role in shaping future policy.

“While we welcome the Government’s signals that it is considering policy changes to address the wholesale conversion of sheep and beef farmland into carbon farming, the Government action has been too slow, the time to act is now.

“We have been raising concerns for some time about the speed and scale of land-use change due to the unbridled ability of fossil fuel emitters to plant exotic trees on sheep and beef farmland for offsetting rather than reducing their emissions.

“B+LNZ is not anti-plantation forestry and we have always seen significant opportunities for the integration of exotic and native trees on-farm, but this should not come at the expense of rural communities.

“New Zealand is the only country in the world with an ETS that currently allows unlimited forestry offsetting and both the Climate Change Commission and the Parliamentary Commissioner for the Environment have recommended that limits are needed.

“Our own view is that the Government needs to change the ETS because that is the legislation that’s causing the problem.”

Don Cameron, mayor of Ruapehu District, said an urgent and more strategic approach is needed for planting trees to sequester greenhouse gas emissions to avoid long-term damage to rural communities and export returns.

“The Resource Management Act (RMA) currently does not allow for a strategic approach to be taken to plantation or carbon-only forestry in the regions. The National Environmental Standards for Plantation Forestry (NESPF) also do not cover carbon-only farming.

“While the market will ultimately drive land use, forestry is a more permanent crop than horticulture, cropping or meat production. Although forested land can revert to other uses, the carbon liabilities, economics and terrain constraints mean that, in practice, large scale reversion is unlikely to occur.

“That reinforces the need for policy-makers to plan and consider legislation, regulations and national planning frameworks carefully before large-scale land-use changes become locked in.”

The paper outlines four key themes which need to be addressed: land prices and market forces; the

ETS and its settings; carbon farming regimes; and mechanisms to control both the scale and location of plantings.

It also sets out a range of policy areas for further urgent investigation that could address the situation, including the Overseas Investment Office (OIO), the ETS and the RMA.


For more information, please contact:

  1. Lawrence Yule on 027 249 6206 or lawrence@yulealexander.com
  2. Sam Halstead on 027 474 6065 or sam@latituduesc.co.nz
  3. Don Cameron on 021 202 7629

Notes to editor: The research was funded by the following councils alongside Local Government New Zealand and B+LNZ. Central Hawke’s Bay, Gisborne, Hastings, Hurunui, Manawatu, New Plymouth, Rangitikei, Ruapehu, South Taranaki, Southland, Stratford, Tararua, Waimate, Waitomo, Western Bay of Plenty and Wairoa.

The views expressed in the paper are formed after consultation with:

  • Government Ministers
  • Members of Parliament
  • Mayors
  • Councillors
  • Community Board members
  • Federated Farmers
  • Māori
  • Farmers
  • Forestry and farming industry groups
  • Climate Change Commission
  • Te Uru Rākau
  • NGO’s
  • Consultants and valuers.