Tougher economic and environmental conditions cause new dairy farms to slow to a trickle

In regions overseen by the Horizons Regional Council (Manawatu-Wanganui), Environment Canterbury and Environment Southland, conversions in the last year have almost totally dried up.

These are the regions that saw the most rapid increase in the numbers of dairy cattle, as farmers moved out of traditional sheep and beef farming in order to chase after “white gold”.

Figures provided by Horizons and Environment Southland show that over the last five years, conversions hit a high in 2014 as global dairy prices soared.

In the Horizons region, they reached a peak of 24 in 2014, before dropping to 15 in 2015 and by this year they were down to zero.

Dr Nic Peet, Horizons group manager strategy and regulation, said dairy conversions required consent only from 2010 onwards.

“Generally dairy conversions have slowed down. It is important to also note that a significant number of these consents have consisted of one or several paddocks being converted as opposed to whole farms. The proportion of land converted to dairy in our region is really small – in most of our catchments it’s less than one per cent of land.”

In Southland, conversions were at their highest in 2014 with 35 consents granted but this year they had plummeted to only two.

Canterbury’s big growth year was in 2011-12 when 110 new dairy effluent consents were issued; by this year they had dropped to 20.

In the dairy heartland of Waikato, statistics on farm conversions are harder to come by. A Regional Council spokesman explained that in many other regions conversions needed a specific resource consent.

“In Waikato, most dairying and farming activities are generally a permitted activity not requiring a specific resource consent per se, as long as they comply with the regional plan rules. We monitor dairy farm compliance with those rules through regular inspections.”

“Individual conversions may need a consent for a particular part of their operation, for example earthworks, but not the actual conversion to dairying,” he said.

However any new conversions in the Waikato and Waipa Rivers catchments since the Healthy Rivers Plan Change was publicly notified now need a consent, but that has been only recently put in place.

One of the country’s largest conversion projects was the pines to dairy operation on the 26,000-hectare Wairākei Estate north of Taupo.

There work began in 2004 to convert the property – which had been largely pine forest – into 39 farms carrying 43,000 cows, but after an environmental outcry contractor Landcorp abandoned the project last year after creating 13 farms with 17,000 cows.

Between 2008 and 2012 the Waikato lost 18,700 ha of plantation forests, while another 28,400 ha of land became dairy farms. In total, New Zealand lost 9600 ha of plantation forests, but increased dairy by 157,900 ha.

Taranaki Regional Council director-resource management Fred McLay, said that unlike regions such as Canterbury or Southland, Taranaki had been a long-established dairying region.

“Large-scale dairying began here in the 19th century and only a handful of conversions – either to or from dairying – have taken place in recent years. We certainly see no trend either way.”

Federated Farmers dairy group chairman Chris Lewis said after the expansion of the last 10-15 years, “the new normal is that farmers aren’t going hell for leather, they are trying to produce milk sustainably in all sorts of ways – environmentally, but also from a business point of view.”

DairyNZ senior economist Matt Newman said there were two factors behind the slowed rate of conversions.

“The first is the dairy downturn that has meant that farmers aren’t in a position financially to invest in new farms. The second is an uncertainty in some regions around environmental requirements and regulations and the potential investment required. They are rightly and prudently being cautious with their investments for the future.”

In 2015-16, Waikato had the most cows (23.1 per cent) followed by Canterbury (18.6 per cent), Southland (11.5 per cent), Taranaki (9.7 per cent), and Manawatu/Wairarapa (7.7 per cent).

 

Source: Stuff

Link: https://www.stuff.co.nz/business/farming/96947385/tougher-economic-and-environmental-conditions-cause-new-dairy-farms-to-slow-to-a-trickle

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