The Minsitry of Agriculture Briefing for Incoming Ministers paints a mixed picture for agriculture.
The BIM is 48 pages long and I’m not going to analyse it all, just give some thoughts on some of the matters raised.
The good news, for those of who wonder if primary production still matters is MAF’s reminder of the importance of agriculture, food and forestry industries to the economy, employment and social wellbeing and that they generate 64% of our merchandise export earnings.
They are the only major industries in which we have sufficient scale, market share and supply chains to be truly competitive in international trade. New Zealand is the world’s largest dairy and sheep meat exporter, and has some of the world’s most competitive horticultural and forestry industries.
Over the next 20 years, New Zealand’s food and fibre producing capability will become increasingly important. Globally, rising population and economic growth is expected to increase demand for agricultural and forestry products. At the same time land and resources, such as freshwater, available for food and fibre production worldwide is likely to decline.
Despite this favourable long-term outlook for New Zealand’s primary production sectors, our industries, environment and broader society face a complex set of challenges to reap future opportunities. These challenges are exacerbated by the current global financial crisis that continues to unfold with uncertain impacts and duration.
Among the challenges are an expected decrease in demand for our exports and difficulty getting credit and servicing debt.
Then there’s the importance of free trade:
For a small country lacking significant economic power, legally-binding multilateral trade and environmental management rules are important to achieve economic and environmental benefits not available by other means.
The importance of environmentally responsible practices was outlined:
The challenge is to develop integrated policies that provide incentives for the sectors to work towards a more sustainable balance in economic, environmental, social and cultural outcomes for the benefit of all New Zealanders. As resources become fully allocated and ecosystems reach the limits of what they can deal with, there are increasingly difficult decisions needing to be made that will impact on the practices of primary producers.
Water availability and quality are also pressing issues and improved water management – of both quality and quantity are an urgent priority.
In 2002/03, irrigation was estimated to contribute around $920 million net GDP “at the farm gate”, over and above that which would have been produced from the same land without irrigation. Since then, the area of irrigated agriculture and horticulture has increased by about 25 percent, from 480 000 hectares to around 600 000 hectares.
Theoretically there is a further 1.9 million hectares of land capable of being irrigated. However, most of the recent increase in irrigation is sourced from groundwater, which has generally reached or is quickly approaching allocation limits in most parts of the country. Further irrigation development, particularly on the eastern side of New Zealand as climate change impacts, will require water storage and distribution systems to deal with fluctuating water availability.
Currently only about four percent of all the freshwater that flows toward the sea is extracted. In Canterbury, where most irrigation occurs, just one percent of allocated water comes from storage infrastructure.
Storage is the best way to make use of water for irrigation with the least impact on river ecosystems because it takes the water at high flows, which generally is during the spring snow melt, or during and after heavy rains, and stores it to use when it’s dry.
But not everyone accepts this or wants it in their backyard so getting resouce consent is a long and expensive process.