Envirologue by Dave Hansford


The Power of N – Nutrient Caps and Peak Dairy

Chris Lewis quickly backed down from the suggestion of a dairy moratorium in the Waikato, but environmentalists won’t let it go so easily. The Waikato Federated Farmers president now insists he merely raised the notion as a “straw man” at an executive meeting, and that he was subsequently misrepresented. But the genie is out of the bottle again, so we may as well talk about it.

Lewis’ comments specifically referred to a plan by state-owned farmer Landcorp to run another 27,000 cows on 20,000 hectares of former forests at Wairakei, near Taupo, by 2021. They came as something of a surprise because until now, the Feds’ response to everything – climate change, the economy, food security – has always been to argue for still-greater production. But Lewis has spotted a game-changer coming: one that has only just begun to divide the country’s most muscular agricultural cartel.

It’s all about cows’ wee. Each day, every dairy cow in the country passes 23 litres of urine, and there are now 6.7 million of them. There are also around 3.6 million beef cattle, which means our landscape gets drenched with more than 230 million litres of bovine urine (plus the outpourings of calves and 29.6 million sheep) every day. The nitrogen load of a single urine patch can run to a tonne per hectare, and that’s far more than any natural system can absorb – more than 750 tonnes of nitrogen run into Lake Rotorua alone each year.

Depending on soil type and topography, it can take up to 100 years for nitrogen to leach into the nearest waterway, and that’s the zinger right there. Many of our waterways are already saturated with nitrogen (and its evil twin, phosphorus), such that regional councils are spending tens of millions of ratepayers’ – and taxpayers’ – dollars trying to clean them up. But we haven’t even begun to see the worst of it. Beneath every dairy district, there is a subterranean tidal wave of nitrogen seeping inexorably downhill, into groundwater, into creeks, then rivers, then estuaries. As it goes, it whips plants into superfertile overdrive: freshwater algae run riot, exploding into blooms of sometimes-toxic scum.

All this comes at the expense of other creatures: studies show that high levels of dissolved nitrate can stunt development and reproduction in aquatic invertebrates and fish, or straight-out kill them. People cannot swim, or fish, or paddle, or drink the water. By any sane measure, it becomes clear that New Zealand reached Peak Dairy years ago. It has to stop; councils know it, and now some farmers understand it too. Nitrogen caps are limits, set and enforced by regional councils, on the amount of nitrogen allowed to leach from a given farm. Horizons Regional Council in the Manawatu has finally, after years of litigation by farmers, imposed a duly compromised set of restrictions around land use and runoff, and requires each farmer in the Manawatu River catchment to prepare a nutrient budget. The Bay of Plenty Regional Council, faced with crippling bills to rehabilitate Lake Rotorua, has moved too. Similar restrictions now guide agriculture around the margins of Lake Taupo.

So Chris Lewis – and most thinking farmers – can see the writing on the wall: if they’re not already regulated, they soon will be. And the more farms – or more correctly, the more cows – in a catchment, the smaller will be each farmer’s nutrient allowance. Don’t underestimate the magnitude of what’s happening here: for the first time, the headache of nutrient leaching is slowly being transferred back to those who caused it. Farmers have enjoyed a privileged status since the country was founded. They may have had subsidies wrenched off them in 1984, but make no mistake; they’ve nevertheless enjoyed a form of protected status ever since. In the realisation of their profits, they’ve left 56 per cent of monitored lowland lakes eutrophic – full of enough nutrients to trigger a bloom – or worse. The National River Water Quality Network, a monitoring programme that regularly samples 77 river sites country-wide, recorded nitrogen loads increasing by 1.4 per cent a year between 1989 and 2007.

The Government has committed a shade under $14m to rehabilitating such fouled reaches as Lake Ellesmere, and the noxious Manawatu River, found by the Cawthron Institute to be the filthiest river in the western world. The Lake Taupo clean-up was projected to cost at least $80m, but needs much more. The Waikato River will need at least $210m to return to health. The Rotorua Lakes will cost at least the same. All these projects are funded by some mix of central and local Government funding. According to Environment Minister Amy Adams, New Zealanders have already committed more than $450m in taxes to cleaning up their own iconic lakes and rivers after farmers have finished with them. That, in any language, is a subsidy.

And that’s the damage already done: future generations will grapple for decades with the insidious, lasting legacy of what we enjoyed as a dairy boom.

Endlessly citing the familiar litany of dairy pollution, though, doesn’t get us any closer to a solution. We need to understand the position some farmers have found themselves in. The Government has saddled them – dairy farmers in particular – with the responsibility for resuscitating a moribund economy (don’t confuse the cost of earthquake rebuilds for prosperity). Under the terms of the Primary Growth Partnership, ag minister Nathan Guy wants primary sector export receipts to double in value by 2025. Given that they have already wrung monumental production increases from their properties – an average 57 per cent per hectare between 1992 and 2012 – that demand in critical markets like China has flattened, exchange rates routinely swing against them, and international dairy prices tumbled more than 50 per cent last year, the only practical thing left for dairy farmers to do is to stock more cows.

That, of course, is precisely what regional councils don’t want them to do – and nor does the public. But farmers find themselves in a crossfire of signals. The Government, like some Harlem pusher, is doing everything it can to coax farmers into still more expansion. It has adopted fresh water quality standards so lax they would give the filthy, lifeless Yangtze a clean bill of health. It removed the obstacle of a democratically-elected regional council in Canterbury that was proceeding on water issues with a caution mandated by voters. Instead, it installed pro-irrigation, agri-business-friendly “commissioners.” It has devoted $35m of taxpayers’ money to facilitating irrigation schemes. It granted agriculture exemption from the Emissions Trading Scheme on what is unfolding as a perpetual basis.

That’s only a small part of the onus on dairy farmers to intensify: many operate on land valued at close to $40,000 a hectare, with assets – stock, plant and machinery – worth an average $1.2m per farm. These costs are far in excess of what their international competition must meet, and the result is breathtaking levels of debt. Over the past decade, dairy sector debt almost trebled to around $32b – an average of more than $2.2m per farm (but debt is in reality heavily concentrated: around half of it is held by just 10 per cent of farmers). There are cases of individual farmers presently more than $10m in the hole. With that much riding on assets so exorbitant, there’s a powerful incentive to produce as much milk as you can.

So it’s all the more laudable that many farmers are spending big money to curb nutrient losses and adopt best environmental practice; writing up nutrient budgets, analysing nitrogen and phosphorus losses through dedicated software. Restoring wetlands so that they can help absorb the losses. Building stand-off pads and winter houses to get cows off boggy paddocks, when nutrients run straight off.

Which is one reason Chris Lewis is wary about the expansion plans of Landcorp and others. He insists that he doesn’t want any good work already done undermined by industrial-scale operations upstream. But most of all, he knows what will happen when regional councils eventually put a price on nitrogen and phosphorus. He knows that first-come, first-served mechanisms in the RMA will not serve smallholders and family farms well. That they couldn’t possibly compete with the likes of Landcorp when it comes to buying up allocations or credits. He knows that nutrient charges would tip scores of farms presently running on a knife edge of viability clean over that edge. The jostling for position has already begun.

For the first time in the country’s history, we are seriously considering two transformational ideas: farming within limits, and polluter pays. A very small molecule is having a profound effect.

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