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5 Reasons why we need to drop the Nitrogen reference point

Firstly feel I should write a bit of a disclaimer to clarify my position. Environmental regulations are required to improve water quality in our Region, the majority of what is being proposed by the Waikato Regional Council and especially that relating to the Farm Environment Plans is good policy, is practical and will help achieve real water quality gains. There is still much to clarify but the concept is good and to be fair to WRC, it is extremely difficult to create environmental regulations that can be enforced yet are fair to everyone. Where I feel the problems will arise is around the use of the fixed Nitrogen reference point in the Plan, and here are 5 reasons why.....

1. Nitrogen is not the main problem in most sub-catchments. If the stated goal of this Plan is to improve water quality then why not focus on the main contaminants (sediment, ecoli and Phosphate)? The majority of sub-catchments are already at their 80yr Nitrogen targets which means the restrictions imposed by this rule will far out weight any environmental gains. This is especially true for hill country farmers who will face significant costs to fence waterways, raticulate stock water and in some cases change management practices yet the Nitrogen restrictions will impede their ability to actually pay for it. Smarter policy is needed that will allow farmers to remain financially viable so they can afford to pay for the changes that will make a bigger difference to water quality.  

2. A more targeted approach will be better received by the farmers who actually have to make the changes to their business. Telling a farmer in a catchment that is already at the 80yr Nitrogen target that they must reduce Nitrogen applications, stocking rate etc will invite confusion. N loss reductions will have to be made in some catchments, but these should be supported by actual sub-catchment water quality data. Presenting farmers with facts will help get their buy in as they are the ones who are needed to actually improve water quality. 

3. The Nitrogen limits will reduce dry land values. I accept this is speculation at this point but I would question why any farmer would pay dairy land prices for land that can never be converted to dairy. There are thousands of hectares of good quality land in dairy areas that is currently valued very similar to the neighboring dairy land, these properties can be expected to drop significantly in value once farmers better understand the new rules. The WRC fact sheet on land use change also highlights this point. This restriction falls specifically under the land use change rules, however it is the Nitrogen component of these rules that will prevent a land use change consent being approved in many cases. Best practice management could be used to mitigate the other main pollutants (which typically enter waterways via surface flow) to a level that would still allow changes of land use to occur if well planned and considered. 

4. Too many farmers will be unfairly penalized. As the rules stand, farmers must submit an N reference point between 1st September 2018 and 31 March 2019. The data that will be entered into Overseer needs to be supported by documents as described on page 47 of the PPC1 document. Failure to provide the correct documents will result in their farm being given 75% of the average for that input (ie the 38% percentile). Key supporting documents include, production statements, financial records showing stock numbers, fertilizer invoices, supplement feed invoices and contractor or seed invoices to prove cropping history. Most farmers with a bit of digging will find the required information but many also will not. Recent farm purchase? Land owners who lease out land? Farmers who had a 50/50 sharemilker who has moved on? etc. Keep in mind, not providing this information may result in a relatively high input farm having to drop their production significantly to comply with the rules. 

5. The Nitrogen rules are completely unworkable.  Trying to enforce the rules as they stand would be an administrative nightmare (read WRC's own submission). The reasons for this will be the subject of my next blog as there are too many to list in one section. Basically WRC are trying to use Overseer for something it was not designed to do in giving a fixed number. Overseer is an exceptionally clever tool, but it needs to be used within its limitations. The fact that as a consultant I can not even create an N reference point for a farmer trying to do proper due diligence before buying a farm really highlights this point. The rule was made before sufficient thought was given to the implications of the rule and what is required to make it work. 

Much more information to come on this very important issue for farmers in the Waikato. Please visit my Cranston Consulting facebook page and ask questions if you are worried about how the rules could affect you. 

Thanks
Steve



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