The usual measure of the economics of agriculture needs to be broadened to fully understand the costs and benefits of regenerative farming practices in New Zealand, according to a new report released today.
The report, Determination of the economic and commercial potential of regenerative agriculture, stresses the need to improve the way we value environmental stewardship, which would provide a more balanced economic understanding of all farms in New Zealand.
âWe need to broaden the way we value our food production systems,â says one of the report’s authors, Distinguished Professor Caroline Saunders, Director of the Agricultural Economics Research Unit (AERU) at Lincoln University.
âEconomics can help us assess a wider range of values ââof agriculture, to include its effects on society, culture and the environment. “
Regenerative agricultural management systems can have environmental benefits for biodiversity, water quality and reduced greenhouse gas emissions, the report says. Accounting for environmental impacts, both negative and positive, could provide a useful approach to fully measure the impact of adopting regenerative agriculture for New Zealand.
New Zealand farm businesses have often been criticized for failing to consider the full environmental costs of their products. A report from the Environmental Protection Authority released last week found that agricultural businesses carry the greatest burden of greenhouse gases in the country. In 2014, the costs of the negative environmental impact of the New Zealand dairy industry were estimated to exceed 2012 dairy export earnings by NZ $ 11.6 billion.
The report also highlights the potential for regenerative farmers to access new and emerging financial benefits. These include carbon and biodiversity credits, âgreen financeâ from financial institutions (the terms of which are linked to environmental or social objectives) and bridging finance (through private investments such as Calm the Farm). , for example).
âRegen agâ is a sustainability trend that is likely to evolve at different rates internationally, says the report, which suggests methods to assess the possible value of regenerative agriculture in different markets. Recent market research has revealed that around 40% of potential food customers from New Zealand to California and the UK are aware of regenerative agriculture and associate ‘regenerating’ farmed foods with reduced environmental impacts. and better animal welfare.
âThese qualities have the potential to help New Zealand agribusinesses generate more value for our food exports. There could be the potential to generate a premium, protect market share or further strengthen New Zealand’s food reputation, âsays Saunders.
âThe commercial success of regenerative agriculture will depend on the prices farmers can obtain for their products, especially abroad. “
The report is one of three new reports released today that provide insight into how to assess the impact of regenerative agriculture on farm businesses. The reports examine how New Zealand agribusinesses could determine whether adopting regenerative agricultural practices could increase the quality or quantity of their products, or the profitability of their business.
All three reports were produced by a research project funded by the Our Land and Water National Science Challenge, the NEXT Foundation and Manaaki Whenua – Landcare Research. The project produced 20 reports published through November, each providing recommendations on how claims regarding possible specific benefits of regenerative agriculture could be tested in Aotearoa, New Zealand.