Two items of news from the Minister of Agriculture’s office today have implications for the ag/hort sector.
Prime Minister Jacinda Ardern and Minister for Agriculture, Damien O’Connor, launched the Centre for Climate Action on Agricultural Emissions alongside the primary sector partners today at Mystery Creek Fieldays.
2. Government sets out next steps for on-farm sequestration strategy
Prime Minister Jacinda Ardern, Agriculture Minister Damien O’Connor and Climate Change Minister James Shaw have confirmed the next steps in the Government’s partnership with the primary sector to develop a strategy for on-farm carbon sequestration.
The first of the two announcements accompanied the launch of the Climate Action Centre that was announced as part of Budget 2022 and focuses on reducing agriculture emissions through research and development, including a substantial new public private 50:50 joint venture.
Four points were highlighted:
- New Climate Action Centre launched to support farmers reduce ag emissions through R&D investment;
- 50:50 joint venture between Government and agribusiness to accelerate product development;
- First Centre projects launched to get farmers the emissions reducing tools sooner;
- Indicative funding commitment rising to $35 million per year by Joint venture partners, seeing at least $170 million invested over the next four years
“Our focus is supporting farmers to grow their exports, reduce emissions, and maintain our international competitive edge into the future” Jacinda Ardern said.
“Farmers are the backbone of our economy and we have to secure the future growth of our primary industry exports, by maintaining our competitive edge in a volatile global market.
“As part of the centre’s work to help farmers we’re partnering with the sector to invest $27 million into three new projects to decrease emissions and promote sustainable economic growth.
“Since 2017 we’ve worked hard to support our primary industries export growth, seeing a 39 per cent increase, which now contributes over $53 billion to the economy.
“Growing our exports provide greater economic security for all New Zealanders, and lifts the quality of living through higher wages, new jobs, and greater stability during economic downturns.
“We need to face the future to maintain our competitive edge internationally, and keep giving customers every reason to continue buying New Zealand’s food and fibre. Exporters are already telling me the role sustainability is playing in customer’s decision making,” Jacinda Ardern said.
The Government announced the Centre’s first three investments help farmers bring down emissions and futureproof the export growth of the sector to provide greater economic security for all New Zealanders.
An investment of $7.8 million will go alongside Ruminant Biotech’s $9.5 million contribution to develop a methane inhibiting capsule, or bolus, which delivers at least a 70 per cent reduction in methane whilst active, Agriculture Minister Damien O’Connor said.
“This will not only help us reach our emissions reductions targets, but will set New Zealand up as a leader in the methane inhibitor industry globally.”
The government is helping sheep farmers reduce emissions by investing over $2.2 million alongside a $2 million contribution from Beef + Lamb New Zealand and other industry partners, to increase our supply of low methane rams through genetic selection, introducing more low methane traits into the national sheep flock.
The third project will invest around $6 million in urgently needed greenhouse gas measurement equipment and infrastructure. Product developers need greater access to testing equipment to prove the efficacy of new products and get tools in the hands of farmers sooner.”
Damien O’Connor said as part of the joint venture the Government is partnering with ANZCO Foods, Fonterra, Ravensdown, Silver Fern Farms, and Synlait. In the last week Rabobank has also signed on to join the partnership.
Partners in the new joint venture have made an indicative funding commitment that will rise to around $35 million a year by 2025, matched by Government. This will see around $170 million invested over the first four years and we expect that to grow over time.
“These are just the first of our investments as we continue to prioritise supporting farmers by investing alongside industry in solutions that future-proof our primary industries and provide greater economic security for all New Zealanders,” Damien O’Connor said.
The agriculture sector contributes nearly 50 per cent of New Zealand’s gross greenhouse gas emissions, and around 91 per cent of our biogenic methane emissions.
The joint venture was launched at the event with Sir Brian Roche announced as Chair.
The funding comes from the $338.7 million over the next four years to strengthen the role of research and development for new tools and technologies to reduce on-farm emissions.
It will have two key components – a new public private 50:50 joint venture, and an enhanced New Zealand Agricultural Greenhouse Gas Research Centre (NZAGRC).
The second announcement confirmed the next steps in the Government’s partnership with the primary sector to develop a strategy for on-farm carbon sequestration.
Three key points were highlighted:
- Government to work with primary sector on developing a sequestration strategy
- Government is committed to sequestration being recognised from 2025
- Transitional arrangements in place from 2025 with entry into the Emissions Trading Scheme to follow later.
The recognition of on-farm sequestration was a core component of the Government’s work to reduce New Zealand’s agricultural climate emissions, the statement said.
“We want a plan for reducing agricultural emissions we can all agree on. We’ve heard sequestration is a top priority for farmers and critical to making He Waka Eke Noa work,” Jacinda Ardern said.
“The Government has already committed to sequestration being recognised and compensated for from 2025. The He Waka Eke Noa partnership, the Climate Change Commission, and the Government all agree that it needs to be done in a way that is fair, cost-effective, and scientifically robust.
“The recent consultation process has highlighted how important the issue of sequestration is to farmers. This is work we already had underway, but next step will be to work closely with farmers to develop the scientific, and policy approaches needed to best recognise sequestration that occurs on farms.
“The best way to achieve sustainable emissions reduction is by working together. The Government remains committed to He Waka Eke Noa and we are pleased to undertake this important work on sequestration with farmers to help deliver it,” Jacinda Ardern said.
Agriculture Minister Damien O’Connor said the industry has asked for a plan that covers all forms of scientifically robust sequestration possible on-farm, and we support that.
“There is more work to do, much of it technical, but today we affirm that this will be undertaken in close partnership with the sector” Damien O’Connor said.
“The sector partnership recommended that the Emissions Trading Scheme be improved and updated to allow more vegetation categories to be included and that vegetation types eligible under He Waka Eke Noa could be transitioned into the NZ ETS as it is expanded and improved.
“This builds on the Government’s commitment to establish native forests at scale to develop long term carbon sinks and improve biodiversity,” Damien O’Connor said.
Climate Change Minister James Shaw said the government’s proposals represent a significant shift in the way the Emissions Trading Scheme works.
“It means farmers will get full recognition for scientifically proven sequestration on their farms. This should unlock a wave of research, science and innovation into forms of emissions removal that also enhance biodiversity and other important values that aren’t always achieved through exotic forestry plantations.
“Bringing new categories into the ETS may take some time, so there will also be a need to ensure transitional arrangements from 2025.
“In-line with the Primary Sector Partnership’s original proposal, the Government is committed to sequestration being recognised from 2025,” James Shaw said.
The s215 Report on emissions pricing will be published by the end of 2022. A series of policy decisions on He Waka Eke Noa will be made in early 2023 with the aim to introduce legislation by the middle of the year.
Source: Minister of Agriculture
