Tim Cronshaw had a very one sided article in the Press yesterday about what the Government's 'Emissions Trading Scheme' (ETS) may cost dairy farmers to reduce their emissions from cows, on the farm and energy used in the manufacturing process.
Cronshaw quotes Wellington analysts Infometrics who modeled that the Government's ETS scheme could hit dairying production by a third in 2025.
Fonterra says reducing the carbon footprint of dairy farms would cost its suppliers 3c/kg of milk solids in 2010, 10c by 2013 and 30c by 2025 calculating that reducing greenhouse gas emissions will cost its dairy farmers $500 million a year by 2025.
Those are scary numbers but so are these.
Little more than a week ago Fonterra Chairman Henry Van Heyden predicted that this summer's drought will also cost dairy farmers as much as $500 million by the end of the season in May. Am i the only one that sees the irony here?
What will it cost farmers to NOT do anything about climate change.
As Geoff wrote in a previous post - agriculture is very important to New Zealand and our economy, which is exactly why we need to ensure that it's practiced in a sustainable way that allows us to keep producing food for years to come. For that to happen New Zealand's environment and place in international markets need to be looked after.
Consumer expectations are changing. People are increasingly demanding sustainably produced food - especially in Europe and the UK. This fact is not lost on Fonterra's climate change project leader Kimberly Crewther who says;
If we have consumers paying a premium for low-carbon products we want to be taking advantage of it.
So they want to reap the benefits of emission reductions with this opportunity to capture the premium end of the market without making any sacrifices along the way?
That is a very short term view and does no favours for the long term prospects of a healthy agriculture sector in NZ.
Furthermore, if the dairy farming sector doesn't pay for its emissions taxpayers will have to foot the bill instead. If you flip the $500mill a year figure, it's $500mill a year that taxpayers will be subsidising the sector if they don't pay for their emissions themselves.