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How New Zealand’s Climate Fight Is Threatening Its Iconic Farmland

Gisborne, New Zealand — Hole Hole Station, a sheep and cattle ranch, is spread over 4,000 acres on New Zealand’s North Island. Jagged undulating hills and steep gorges are overgrown with green grass.

Despite the undulating terrain, it is a highly productive agricultural land. But it soon ceases to be a farm.

The land’s owner, John Hindlap, who bought it for NZ$1.8 million in 2013, sold it for $13 million ($8.2 million) this year. His windfall came thanks to New Zealand’s newly profitable industry. Forestry investors cover land with trees to profit from the carbon they absorb from the atmosphere, not from the wood.

“If you had told me this two years ago, I wouldn’t have believed you,” Hindrup, 67, said of soaring land values.

So-called carbon farming has become a key factor in driving New Zealand’s decarbonisation. carbon neutral By 2050. emissions trading programenterprise Carbon-intensive industries need to buy credits to offset their emissions. Many of these credits are purchased from forest owners, and as the price of credits skyrocketed, forestry investors are looking to buy ranches to make a profit.

Emissions trading programs are New Zealand’s most powerful tool for reducing greenhouse gases. But the loss of ranches to carbon farming threatens one of the most iconic industries and could change the face of idyllic rural areas. Farmers and agricultural experts fear that sheep and cattle ranching, which is a major employer in many communities and one of the country’s largest export sectors, is headed for a major decline. manifesting.

“We’re talking about land-use change, perhaps beyond what we’ve seen in the last 100 years,” said Keith Woodford, emeritus professor of agriculture and food systems at New Zealand’s University of Lincoln and an industrial consultant. rice field. “This is a major change in land use and we need to make sure it is what we want.”

The national emissions trading program is the only one in the world that allows companies to offset 100% of their emissions through forests. (The United States has a regional carbon trading initiative, but no national program.) New Zealand has not done enough to reduce its emissions, so it relies heavily on carbon agriculture.

Although small on a global scale, New Zealand’s emissions were still rising before the pandemic, making it one of the largest per capita sources of carbon pollution among developed countries.New Zealand’s agricultural sector Largest emitter of greenhouse gasesmainly through methane emitted by animals.

According to Woodford, today’s policy decisions respond to a long road to addressing climate change, essentially locking down land use for decades. Permanent carbon forests need trees to stay planted, and timber forestry to earn carbon credits replant a tree After they are harvested (usually in their 28th year) or face financial penalties.

Already, the amount of ranch land sold to forestry players has soared, much of it to foreign buyers such as Australia, Malaysia and the United States. In total, about 10,000 acres of beef and sheep farms were sold for forestry in 2017, according to the report. report Manufactured under contract from the industry group Beef + Lamb New Zealand. Two years later, he’s at 90,000, and although sales dipped early in the pandemic, they’re expected to pick up in 2021.

Land sales have increased as the price of carbon credits has tripled over the past three years to reach NZ$80. This increase is due to the imbalance between demand and supply of credits due to New Zealand’s still high emissions, and the need for the country to further strengthen climate policy to meet its pledges. It reflects the influence of speculators who expect the stock market to continue to rise.

At current prices, credits are 1,000 New Zealand is $1 per acre per year, compared to about $160 for sheep and cattle farms.

David Hall, a climate change policy researcher at Auckland University of Technology, said the price of credit is likely to exceed $100 in the next few years, but prices above $200 are needed to drive change in the transport sector. needed to reach carbon neutral goals.

It is not known how many trees New Zealand would need to meet its pledge. It will depend on how quickly countries transition to a low-emission economy, with technological advances reducing the need for carbon farming.

In current projections, the country’s Climate Change Commission 2.7 million acres of carbon forests by 2050 13 million acresabout 70% of the area occupied by sheep and beef farms in New Zealand.

Cutting 2.7 million acres from the sheep and beef sector could lead to a loss of NZ$2 billion a year in exports, Woodford said. in total about 12 billion dollars, or 15 percent of total exports.

Without an obvious industry to fill the export gap, Mr Woodford said, the exchange rate would come under downward pressure and ultimately raise the cost of imports for New Zealanders. It’s not, but it’s certainly significant,” he said of losing most of his beef and sheep farms.

For rural communities, carbon farming risks creating “green deserts” of trees that create few jobs. Permanent carbon forestry provides approximately one job per 2,500 acres per year after planting. report From Te Uru Rakau, Forestry Department, New Zealand. Timber forestry creates dozens of jobs between planting and harvesting, but few jobs in the almost 30 years in between. Beef and sheep farming provides about 13 full-time permanent and seasonal jobs. jobs per 2,500 people acre.

Hindrup said the recently sold Hollehole Station employed three people full-time, with many working part-time, including shearers, fencers and helicopter pilots. . Then there were truck drivers, cafe owners, etc. who indirectly depended on the ranch income.

Gisborne farmer and council member Kelly Werthnop, one of a dozen communities concerned about converting ranch to forestry, said, “It will destroy these communities and hurt the local economy. Just destroy it,” he said.

1 report We found from a business advisory firm that nearly half of the work (about 10,000) would evaporate if all the steep and difficult land in the Gisborne area turned into permanent carbon forests.

Farmers face a range of pressures from New Zealand’s environmental goals. The government considered changing rules to take some of the heat out of rural land sales, but backed off in the face of opposition from Maori landowners. As more farmers sell their land, operating costs for the remaining farmers will increase as they share costs such as veterinary care, said Toby Williams of his Federated Farmers, an industry group.

Moreover, the agricultural sector will soon face financial penalties for its emissions after being exempt from carbon trading programs. And the new environmental regulations have sparked protests by farmers they have. busy city street on a tractor.

“It wasn’t worth it for my mental health, my physical health,” said Charlie Reynolds, who sold the ranch this year after facing a $250,000 fencing bill to meet new regulations. .

Ultimately, the extent to which New Zealand ranches become carbon forests will be determined by farmer choices. Some even plant their possessions in trees.others are withdrawing income both cattle and carbon By turning underused ranch areas into forests, such as erosion-prone gullies.

Niven Winchester, an economics professor at Auckland University of Technology, said parts of the economy that emit large amounts of greenhouse gases, like agriculture, should be cut.

“We as a society have to do something about climate change,” Winchester said.

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