Hon David Parker
Minister responsible for Climate Change issues

14 August 2007

Speech notes

The future of Canterbury farming in a changing environment

Address to the Institute of Agricultural and Horticultural Science Conference
8.45am, Tuesday 14 August,
Stewart 1 Lecture Theatre, Lincoln University

Good morning.

Thank for inviting me to kick off today’s discussions about climate change, and in particular, the likely impacts in store for Canterbury.

Climate change is a big challenge, and it demands a serious response.

It is an economic and social challenge, as well as an environmental one.

The Labour-led government sees climate change as part of the wider issue of sustainability. To tackle it, we need to progressively change our economy and society so that we use our resources more sustainably.

We need to do our fair share as a country to reduce our greenhouse gas emissions, while encouraging developing countries to avoid the high emissions development path that we have already followed.

I’m hopeful that we can collectively make a difference – this issue is now high on the agenda of the world’s leaders, as it is of course here at home.

No matter what we do, however, greenhouse gases already in the atmosphere mean climate change will occur to some degree, and indeed is already occurring. We must be prepared for that.

With an economy heavily dependent on the primary industries, Canterbury will face particular challenges for water management and so I am pleased see that the theme of this conference is “Growing smarter with less water”.

What are the implications for New Zealand and Canterbury of a changing climate? I expect that Jim Salinger will provide more detail on this in a moment and that later papers will cover the impacts of drought and making the best use of water, so I will be brief. We can expect gradual changes in climate as well as changes in the frequency and magnitude of extreme events. We can expect reductions in plant growth through greater soil moisture deficit in summer over the next several decades in eastern areas of New Zealand. This may be compensated in part by expected increases in winter temperature, which will increase the length of the growing season.

We can expect that average and worst year pasture production to decline for east coast locations such as Canterbury. By the 2080s severe droughts are projected to occur between two and four times as often in Canterbury. At the same time, flows in the rivers fed from the Southern Alps in Canterbury and Otago are expected to increase, but it is not clear whether this will compensate for the likely increase in water demand. In any case, flows in other lowland streams in the east are likely to decrease with the drier local climate. Some of these changes are inevitable due to the impact of greenhouse gases already in the atmosphere. This will be a key challenge to face as we prepare to adapt to shifts in the climate.

And, as I have already mentioned, New Zealand needs to reduce its emissions of greenhouse gases if we are to play a part in encouraging other countries to take the necessary action. And they continue to grow – our emissions on average across all sectors for 2005 were 25% higher than in 1990.

We have a unique interest in agriculture and horticulture. In May the government announced a new research fund to bolster New Zealand’s international leadership position in helping the agriculture and forestry sectors respond to climate change. The fund will be used to foster international work on agricultural greenhouse gas measurement and mitigation. It will help with technology and knowledge transfer to developing countries through the development of formalised collaborative relationships and exchange programmes.

As a small trading nation, we also need to recognise the shift in attitudes in our key overseas markets. The term “food miles” refers to how far food has travelled before you buy it. Just a few days ago, the UK Times quoted the author of How to Live a Low-Carbon Life as saying “Don’t buy anything from the supermarket… or anything that’s travelled too far”. Thanks to important work by Lincoln University and AgResearch, a little more light is being injected into this issue. Indeed, last week the New York Times quoted this work in asking if it “wouldn’t make more sense to stop obsessing over food miles and work to strengthen comparative geographical advantages”. Nevertheless, this shows how vulnerable New Zealand is to the perceptions of the consumers of the food we export.

So how can we reduce emissions? New Zealand’s unusual greenhouse gas emissions profile presents a challenge to manage. Nearly 50% of our emissions come from agriculture, compared to 12 percent on average in many other developed countries. In December 2006, the government consulted broadly on climate change and energy policies. For agriculture and forestry we proposed working with sectors and local government to prepare a Plan of Action to adapt to a changing climate, reduce emissions and enhance sinks, and capture business opportunities. This Plan of Action will need to be supported by a substantial investment in research and technology transfer. This presents a real opportunity for your Institute to contribute to climate change mitigation and adaptation.

Key developed countries are moving towards emissions trading schemes. In late July emissions trades started in Australia and Canada in anticipation of mandatory trading schemes in both countries. The United States already has a healthy voluntary emissions market and some states will soon add obligatory markets for utilities. The most advanced “cap-and-trade” scheme for greenhouse gases operates in the European Union. There were some widely publicised problems in the first year of operation of the European scheme which have now been overcome. However, a group of prominent environmental economists has concluded that this scheme has been a success, describing this as “by far the most significant accomplishment in climate policy to date”.

The Government will make important decisions on New Zealand’s move towards a greenhouse gas emissions trading regime in the next few months. Such a scheme could provide New Zealand businesses with a flexible way of reducing their carbon footprint. Participants in the scheme are allocated, or purchase, a share of the emissions permits, which they can trade with others. Those who can reduce emissions can benefit from their reduced emissions by selling their surplus credits to those who need more.

The New Zealand Government is looking for a design that will be economy-wide, and include all sectors, and all gases. Many details have to be considered, before a final decision can be taken. These include when different sectors come in, the transitional path for emissions and the stringency of the targets once they are in. In any event, the future of Canterbury farming, as elsewhere in New Zealand, is one where businesses will need to consider their emissions alongside other factors when making decisions.

Even in the absence of such a scheme, there are many progressive initiatives as the agricultural and horticultural sector moves towards smart, efficient farming. I see that Dr Harry Clark will shortly speak on greenhouse gas mitigation, but I’d like to give a couple of examples.

Grove Mill winery was established in Marlborough in 1988 with a goal to produce premium quality wine with minimal environmental impact. Grove Mill is the first winery in the world to receive carboNZero certification, demonstrating that it added no net carbon dioxide emissions to the atmosphere in the production and distribution of its wines. This starts with longer rows in the vineyards to reduce the number of times the tractor needs to turn around, reducing the diesel consumption per hectare. It continues with a fully insulated winery and warehouse and where waste heat from the winemaking process is used for preparing wine prior to bottling and warming the fermentation tanks. No additional energy is needed to either heat or cool the warehouse reducing the amount of electricity used. And it ends with lighter and smaller wine bottles, so 25% more wine can fit into the containers that ship wine to the UK and USA, further reducing emissions.

Nitrous oxide from animal waste and nitrogen fertiliser use makes up one-third of all agricultural emissions. The dairy sector and fertiliser companies are making significant progress in encouraging farmers to manage nutrients efficiently to reduce nitrous oxide emissions (and nitrate leaching). Nutrient budgets are one of the key tools. There is considerable research underway (funded by fertiliser companies, the Pastoral Greenhouse Gas Research Consortium and the government) to optimise the use of nitrification inhibitors to reduce nitrous oxide emissions and nitrate leaching.

Water is the life-blood of Canterbury and as I noted, a changing climate is expected to affect water demand and supply in Canterbury. Already, degraded water quality in rivers and streams is a serious problem, which needs to be better addressed. This will become an ever more pressing issue and cannot be ignored. We use our clean green brand to sell our produce. It must be real.

Adaptation must be driven by an understanding of the ability of the region to meet long-term requirements for water. Councils in Canterbury Region are to be commended for working with government on the Canterbury Strategic Water Study. The first stage of the study showed that there is enough water in total to meet reasonable demands, but it’s not always in the right place at the right time. The study is now evaluating the environmental, social, cultural and economic impacts of the water storage options. As part of the Water Programme of Action, the government is looking at the role that water storage can play to address demand in water-short catchments. I expect that John Bright will provide further information on his survey of water resources in Canterbury.

Your Institute describes itself as a proactive, independent group working for the continued development of agriculture and horticulture in New Zealand. I see that the Institute seeks to be recognised as the champion of agricultural and horticultural science in New Zealand and that you want to help influence science policies on agricultural and horticultural science. Well, have I got a job for you! New Zealand agriculture and horticulture are facing unprecedented challenges in a changing environment. Challenges in terms of:

- A changing climate, with risks of droughts and storms, but with opportunities of longer growing seasons;
- Changing and increasingly critical consumers, demanding produce with environmental integrity;
- A policy environment in which the Government must address our international obligations and liabilities, and encourage farmers and others to address their emissions.

The “continued development and use of agricultural and horticultural science and technology” have a major role to address these challenges. “Growing smarter with less water” will help Canterbury and other eastern areas adapt to projected water shortages. As we move into a carbon-critical world, the future of New Zealand farming in a changing environment will also require us to “Grow smarter with fewer emissions”.

One final message: Just about everything we will need to do in the name of sustainability, we would want to do anyway. Embrace change in the confidence that it will also increase efficiency and productivity.

ENDS

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