NZ's dairy pollution cost may be $15b: report
The costs of repairing the damage from dairy farming could be as high as $15 billion, according to a new scientific paper.
That figure does not include the cost of biodiversity loss and ecosystem degradation.
The New Zealand Dairy Farming: Milking Our Environment for All its Worth paper focuses on four issues: removing nitrates from drinking water (potential cost of repair $10.7bn); soil compaction ($611 million); greenhouse gas emissions ($3.1bn) and clean, green image ($569m).
Co-author Dr Mike Joy of Massey University said the environmental costs of dairy farming "at the higher end" exceeded the export value of dairy for 2012 of $11.6bn.
"We are saying these are the costs of cleaning up water to drinking standard, but that is conservative because humans are much more tolerant than other forms of life. But at certain levels of nitrates below what humans can tolerate, a lot of freshwater fauna is dead," he said.
Industry and farmer groups have hit back at the paper, with Federated Farmers dairy chairman Andrew Hoggard accusing Massey of "pretending a student's academic hypothesis is established fact".
The figure of $15bn "conveniently coincides with the industry's current contribution" of export returns and GDP.
"If all nitrogen went into the water, there was no dilution from rainfall, all water was used for drinking and if we wanted the nitrate levels to be zero rather than the drinking standard of 11.3 mg NO3N/L, then yes indeed it could cost $10bn to clean up, but this is a not our reality," Hoggard said.
DairyNZ chief executive Tim Mackle said the national policy statement for freshwater management was having an impact on dairy farming already and would constrain growth.
"The dairy industry is focused on reducing its environmental footprint and farming competitively and responsibly. I think New Zealanders get that dairy farming is a huge economic contributor to the economy. But as our latest public perception research shows they also want us to look after the environment and lower our impact," he said.
"We are putting a whole lot of effort into doing that across the country and through our environmental work programme that we are funding at a cost of around $11m a year. Plus farmers themselves are investing millions in environmental initiatives on their farms," Mackle said.
Professor Jacqueline Rowarth, Waikato University Professor of Agribusiness, described the paper as "damaging".
"I go back to Professor Frank Scrimgeour's (Director of the Institute for Business Research at Waikato University) comments that the paper has raised awareness but in terms of the individual components, they cannot be added together credibly in the way that they've done to say that this is the outcome. It's sloppy research," Rowartth said.
The paper, also authored by Kyleisha Foote and Dr Russell Death, highlights how dairy production in New Zealand has undergone a radical change in the last few decades, from a low input, low cost and low impact system to high intensity, high cost, high impact system, increasingly reliant on imported feed and fertiliser.
Joy said the costs, known as externalities, were not borne by industry but rather society, and they were growing.
The analysis revealed that for the worst case scenario, using the limited number of impacts valued, the costs to society were approximately equal to the export revenue and GDP.
He said it was far cheaper to avoid pollution in the first place than try to clean it up afterwards.
"There is now ample evidence that farmers can make more profit and pollute less when not myopically chasing increased production," Joy said.
The past few decades had seen a four-fold increase in milk production and a doubling of the number of dairy cows.
Recently, taxpayer funds have been directed at multi-million dollar clean-ups for example in the Rotorua Lakes, Lake Taupo, the Manawatu River and Lake Wairarapa.
"These are just the tip of the iceberg. The degradation is far more extensive and will increase due to delays in pollution effects being seen; this is because nitrogen can take years even decades to move through the subsurface to waterways," Joy said.