Farm-to-forest conversion policy sent back to drawing board

The Government was on the verge of consulting on its policy to limit conversions of whole farms to exotic forestry in June, but four months on no announcement has been made.
Information released to Newsroom under the Official Information Act shows Climate Change Minister Simon Watts received briefings from officials about plans to go to Cabinet for approval to consult on the policy in mid-June.
One June 11 document was titled “Cover briefing – Cabinet paper seeking approval to consult on managing farm conversions to exotic forestry”, and a second received on June 20 suggested a final or near final discussion document existed: “Updated discussion document and Cabinet paper: Options to manage farm conversions to exotic forestry through the New Zealand Emissions Trading Scheme”.
Only the titles of the briefings were released, not their contents. Though neither Watts nor Agriculture and Forestry Minister Todd McClay would confirm whether anything has in fact gone to Cabinet, both said the policy was taking longer as it was a complex area and they wanted to avoid unintended consequences.
The Government’s action plan for the final quarter of 2024 pledges there will be an announcement before the end of the year on policy direction to limit farm conversions.
Beef + Lamb New Zealand chair Kate Acland said the matter was pressing.
“We’ve been calling for action on this for a long time. Our work has shown that sales to date have had a massive impact on our sector and rural communities. We need urgent action and any delay is frustrating,” she said.
“We look forward to some certainty. There has already been a significant decline in stock numbers as a result of afforestation over the past few years, and we know a lot more is coming as there is a lag between when a farm is sold and when trees go in the ground.”
A study commissioned by Beef + Lamb showed more than 60,000 hectares of pastoral land was converted to forestry in 2021, though rates have declined since then.
“Wholesale exotic planting is negatively impacting the biodiversity and amenity values of our iconic farming landscapes, and the resulting decline in stock numbers has had and will continue to have massive impacts on the viability of our sector, on rural communities, and on New Zealand’s economy,” Acland said.
National’s election manifesto and the Government’s discussion document on its Emissions Reduction Plan included high-level details concerning the proposed policy to limit these conversions.
This included a moratorium on farm-to-forestry conversions on Land Use Classes one through five, which represent the most productive land. There would also be a cap of 15,000 hectares of annual conversions on Land Use Class six land, which is the main class of land used by sheep and beef farmers and represents the highest proportion of conversions.
Climate Forestry Association chief executive Andrew Cushen said current planting intentions were for much less than the 15,000 hectare proposed cap on Land Use Class six land. The lower Land Use Classes were also not generally profitable to convert to forestry.
“The Government has said that it’s going to take some time to think about it and do it right and that’s exactly what we’d like to see done. Better to have the policy done right than to have it done with unintended consequences that won’t work,” he said.
“The Government has been clear that they want to restore confidence and clarity to the sector – forestry in general – and this is part of how that can happen.”
Cushen said there were three areas where more detail was needed and where there was a risk of unintended consequences.
First, it was important that farmers be allowed to convert less productive land on their farms to forestry. The current proposal would permit up to a quarter of landowners’ own land to be converted, he said. This was something Beef + Lamb also supported.
“We support the integration of trees within farms, targeting mosaic landscapes and with farmers able to convert and enter a proportion of their farm into the ETS where it makes sense to do so, regardless of land class,” Acland said.
Cushen’s second question relates to how land might be allocated if there were interest in converting more than the 15,000 hectare cap in a given year.
Third, land blocks are rarely a single Land Use Class. In the hypothetical scenario of a block where Land Use Class one land is surrounded by Land Use Class seven land, the current proposals would see that land in the middle unable to be planted in forestry but also potentially rendered useless if it was completely surrounded by forestry.
“Picture it as an island that is otherwise stranded. It still hasn’t been planted because of those policy restrictions, is that actually an intended consequence of this? You’ve essentially not converted that lower class land but you’ve essentially foreclosed other uses of it because it’s in the middle of a forest,” Cushen said.
Watts told Newsroom the Government was taking the time it needed to work through the issue.
“We are taking time to get this right. MPI and MfE officials continue to work on a range of policies that will deliver confidence and certainty for the forestry and agriculture sectors,” he said.
“Forestry continues to play a key role in the ETS as part of this Government’s response to a changing climate. Minister McClay and I will have more to say about plans to manage farm conversions to exotic forestry in due course.”
McClay said he was hoping to take something to Cabinet “in the very near future”.
“I’ve received advice and am seeking some more. It is a priority for the Government because we’re concerned about our highest quality, food-producing land going into forestry, but we’ve got to get the rules right because forestry also has a very important role to play – not only in the economy but in meeting climate change obligations.”