The dairy boom is well and truly over in the south. From the flood of conversions in the early 2000s, which saw hundreds of new dairy farms established in Southland and Otago, there is not even a trickle.
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The dairy boom is well and truly over in the south. From the flood of conversions in the early 2000s, which saw hundreds of new dairy farms established in Southland and Otago, there is not even a trickle.

Since the start of 2018 only three consent applications have been lodged with Environment Southland for “Land Use to Establish a Dairy Farm”.

One was granted in July 2018 for 50 cows on 21 hectares and another, for 20 cows on 20ha, was approved in April 2020.

The third was for 450 cows on 227ha and was declined in May 2020.

Asked if there would be any more dairy conversions in Southland in the next five years, environmental consultancy company Landpro answered with one word – no.

Southland dairy conversions have required consent since 2011.

Back then, Environment Southland consents manager John Engel said the new rules would not cause concerns.

“Most of the work farmers need to do to get the consents, they need to do for the banks anyway,” he said.

“It’s part of the due diligence. In areas where dairy farming is pretty normal it’s not a problem. All we are requiring is good farming practices.”

However, the proposed Southland Water and Land Plan introduced in 2016 tightened the rules further and the government’s National Policy Statement for Freshwater which followed shortly afterwards was the beginning of the end of new conversions in Southland, for now at least.

“The 2020 National Environmental Standards for Freshwater introduce a further regulatory obligation for those considering a conversion to dairy anywhere within the country,” Landpro’s national manager farm environmental Kim Reilly says.

“These standards also set a very high bar in terms of protecting the environment and will require any person wanting to convert to dairy, which is different to the expanded dairying requirements in Southland, to obtain additional consents to those that may also be required by the regional council.

“For regional councils to be able to grant a consent, they need to be satisfied that the change in land use will not result in an increase in contaminant load in the catchment,” she said.

The 2020 National Policy Statement for Freshwater places an obligation on regional councils to manage natural resources to ensure there is no over-allocation of nutrients from a water quality perspective in the same way they must also manage allocation in a water quantity sense.

“It effectively says an applicant needs to be able to demonstrate that water quality will be maintained or improved as a result of the proposed activity.

“That is a very high threshold or bar to pass over.”

The door was still open for farmers to apply for consent but applications had to show evidence there would be a better environmental outcome as a result of the conversion.

“For many farmers, it will likely be too uncertain at this time, and therefore seen as too difficult or expensive to progress.

“That said, there may be some situations where the case will stack up, and feasibility could be worth investigating, but this would likely be the exception to the rule.

Southland Federated Farmers dairy chair Bart Luyten says there is still land in Southland which could be converted to dairying.

“There are still sheep farms that would make great dairy farms but under the current regulations it seems impossible,” Bart says.

It had created a difference in land prices – between those which had existing dairying or dairying support consents and sheep farms.

“The few conversions that have happened have cost a lot of money to get consents and taken a very long time to process. It’s definitely turning people away.”

While dairying has been a consentable activity in Southland since 2011, it remains a permitted activity in Otago.

An Otago Regional Council spokesperson says it is aware of 10 new farms lodged with the compliance team as operating dairy farms under permitted activity rules since the start of 2018.

“Four farms were added to the list in 2018, five in 2019 and one in 2020.

“The number of cows on these farms totals 5430, based on counts at our most recent inspections, however this number does not distinguish milking from non-milking cows.”

The council is not aware of any new dairy farms in the past year.

The signature of the EU–New Zealand Free Trade Agreement by New Zealand Prime Minister Jacinda Ardern and European Commission President Ursula von der Leyen today – the last day of the French EU Presidency – is announced as a landmark in the five-year long process of negotiations so far.

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