Mon, Feb 20, 2023 5:00 AM

Opinion: Confidence eroded by uncertainty



Golden Bay Farmer, Nigel Harwood says the dairy schedule is the one thing that has kept him confident about his family’s business this season. While inflation has eroded returns considerably, he believes next season is likely to be tougher as inflation hikes continue to erode bottom lines and there is ongoing uncertainty for farmers.

Nigel is less confident about hill country sheep farming even without taking He Waka Eke Noa into account. The current price of Carbon is around $83/ tonne and rising.  Alongside this, income from sheep farming on hill country has flatlined and the same inflationary costs leaves farmers with a very small cheque to get through the rest of the year.  Returns from carbon and tree farming are above sheep and beef farming, and that's why we are seeing these forestry-related companies setting the price for farms when they come up for sale.

But what happens in 25-30 years’ time when there’s a glut of logs for export to one country (China) or do those pine forests just stay in the ground? The current policy settings will lead to a massive (dark) greening of the countryside and decimate rural communities. Not to mention we have just hamstrung a perfectly good industry that has scale and diversity of market. Nigel says overall there’s a need for better planning, incentives, and wider understanding regarding the impact of losing hill country farms and of climate policy in general.

"The Paris Agreement on Climate Change specifically mentions that countries should not implement policy to the detriment of food production, yet that is exactly what NZ appears to be doing. There seems to be belief that we should be leading the way. on taxing farm emissions.

I am old enough to remember ministers in the Lange government telling us that if we remove subsidies the world will follow.  In the recent free trade negotiation with the EU they used our lack of protection against us.  Effectively, we had nothing to give away. Now I read that we are to be world leaders at taxing farm emissions and the world will follow. Please forgive the cynic, I've heard it all before."

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