In a new report, the Dutch agri-business bank says the introduction of the National Policy Statement for Freshwater Management has led to considerable challenges for sheep and beef farmers to comply with environmental regulations.
Rabobank country banking general manager Hayley Moynihan said this was the case even though much of the attention relating to the changes had been on impacts to the dairy sector.
"The environmental risk profile of sheep and beef farming is different to dairy, but with sheep and beef farms representing 30% of New Zealand’s total land area and 71% of pastoral land use, the sector is still a considerable contributor to the total contaminant load that is entering New Zealand’s waterways,” Moynihan said.
“It is therefore crucial that farmers in this sector plan for, and adapt to, increased environmental regulation.”
Scrutiny on contaminant losses
Blake Holgate, the report’s author, said a farm’s impact on waterways is largely determined by the intensity of the farming system and the landscape in which the farming is undertaken.
Sheep and beef farmers should expect regional authorities to look closely at land management practices that can assist in reducing contaminant losses to waterways, according to the report.
"In terms of contaminant loss to waterways, pastoral land uses produce three main pollutant types: the nutrients nitrogen and phosphorous, sediment and faecal microbes," he said.
"With intensive land uses like dairying, nitrogen loss due to leaching into ground water is the major issue. For the sheep and beef sector, which is primarily undertaken on sloping or elevated landscapes, contaminants which are transported to water via surface run-off, such as phosphorus, sediment and faecal microbes, pose the major challenge.
"The rules imposed to regulate the loss of contaminants via run-off will have direct implications for sheep and beef farmers.”
Maintaining competitive advantage
The report also urges sheep and beef farmers to pay close attention to the regulation of nitrogen leaching within their area.
"As relatively low leachers of nitrogen, sheep and beef farmers will need to be cautious of any framework that caps nitrogen limits at, or below, their existing leaching levels, preventing them from intensifying their current operation, or converting to more intensive land uses," said Holgate.
To do so is likely to require widespread adoption of a range of “good management practice” mitigation strategies, the report said, which could include maintaining riparian buffer strips, targeted fertiliser application, careful cultivation and practices to reduce erosion risk.
The effectiveness and cost of these mitigation options can vary due to differences in soil type, climate, topography, land-use and farm management systems.
The report said the new regulations should be implemented in a way that not only ensures communities’ expectations for fresh water quality are being met, but also in a way that does not threaten the international competitive advantage of New Zealand’s sheep and beef sectors by adding unnecessary costs or restrictions to farming systems.
"Environmental sustainability and economic sustainability are inextricably linked and, in the long-term, neither can be achieved without the other,” Holgate said.
“In order to improve both farm profitability and environmental performance, regulators, farmers and processors must work together.
“Only if each of these groups effectively carries out its roles and responsibilities will the challenges posed by the NPSFM be met and the opportunities be realised."