Social licence to operate a must for dairy

Academic and consultant, Professor Keith Woodford says the big challenge for New Zealand dairy is how it can become sustainable in the coming decades.

This sustainability includes both financial and environmental sustainability. And it needs to occur in the context of both scepticism and some antipathy from within the urban community.

One of the challenges for our new Government is to come to terms with the extent to which dairy and indeed the broader pastoral industries provide a key pillar that underpins the export economy. Without a vibrant export economy, there is no practical way we can address poverty and inequality within Zealand. 

 However, that is not the way that many New Zealanders currently see it.  And therein lies the challenge.

I live in an urban community, and my assessment is that most urban people think we do have too many cows.  When I ask what alternatives they recommend, the responses are typically naïve.

A typical response seems to be that we should be developing more plant-based industries, but there is seldom any understanding of the climatic, soil, topographic and market limitations thereof. 

We do have some outstanding horticultural success stories, with kiwifruit, wine and pipfruit being standouts. Hopefully, these and some others can continue to grow, but all face constraints relating to very specific soil and climate requirements.

The "big three" plant-based industries have succeeded because they have focused on consumer markets as the starting point for industry development. 

Through a range of strategies and product positioning, aligned with specific bio-physical resources, they have created a competitive advantage. It has been a way of thinking with which the pastoral industries still struggle.

If dairy is to prosper then it has to have a social licence to operate. That licence includes both environmental and animal welfare components. Each needs to be addressed separately, but both then come together into overall farming systems.

The current level of debate around environmental sustainability is woeful. Most people are firmly in one or other tribal camp. The leaders of the tribes shout out messages across the void. Those messages resonate with their followers but seldom move the debate forward as the other side hears the noise but not the message.

A starting point with dairy environmental sustainability is to recognise that there are at least four important measures. These are bacteria levels in water (with E coli as a key indicator), phosphorus runoff, sedimentation and nitrogen leaching.

The dairy industry has made huge progress with the first three of these but not the fourth. The ongoing successes with the first three need to be acknowledged by the wider community.

The key stumbling block to future dairy environmental sustainability is nitrogen leaching.  There has to be increasing recognition, which scientists understand but the industry has not yet come to terms with, that the fundamental problem is the concentration of nitrogen in the cow urine patch.

During much of the year, this concentration of urine is not a big concern, as plants take up the nitrogen without major leaching. But urine deposited in the second half of autumn is not taken up by plants before winter leaching occurs. And nitrogen added in winter itself largely goes down through the soil and into underground water, only to emerge again downstream.

The only solution is to recognise that cows need to be off-paddock during the second half of autumn and throughout much of winter. Anything else is tinkering. Cows can still graze in the paddocks for a few hours per day, but the ruminating and resting need to occur in an environment where the urine can be collected and spread back to the fields in the following spring and summer. 

Aligned to this, the cow must have somewhere soft to lie off-paddock. Also, although cows do not mind the cold, they do not like lying in the wet. So there has to be a roof.

For many farmers, the above statements will be like the supposed red rag to a bull. It looks like a lot more cost, and where are the extra returns going to come from?   

My own conclusions are that there are economic solutions. However, I do accept that in a heavily indebted industry, where the debt has been structured around assumptions of ongoing capital gain, that many farmers lack the headroom for capital investments.

This is where the Government will need to come in with concessionary finance for sustainability investment, funded perhaps at its own cost of borrowing.

If farmers and the Government cannot work through these issues, then dairy farming will indeed not recover its social licence. And that is in no-one's interests.

I am becoming increasingly confident that dairy composting barns can provide a key pathway to pastoral dairy sustainability.

Although increasingly common overseas, I have so far only found one farm in New Zealand where the principles are understood and applied successfully. I think there are likely to be up to three more operating successfully, but I have yet to visit them.

There is no great secret to it, but it is a different way of thinking.

The key elements of dairy composting are a moderately high-pitched roof (at least 18 degrees), plus roof venting, at least 600mm of suitable bedding material, appropriate stocking for the specific environment and twice daily tilling. Water troughs should be outside the composting area but feed troughs should be inside.  

The compost should last for 12 months in the shed and must stay warm and dry. Break the fundamental rules and it will not work.

The key benefits of a composting barn, apart from preventing nitrogen leaching, are better feed utilisation, less damage to pastures, less winter feed required, and considerably higher per head production. The sheds can also provide summer shade. The cows love this system.

With any new system there will be some challenges. Aspects of what Americans and Europeans do with their composting systems will need to be tweaked for New Zealand conditions and there will be variations within different New Zealand environments.

So that is where we need an R&D programme to monitor and customise the system for New Zealand conditions. This is something I am currently trying to facilitate. Bedding materials and fine tuning of compost management are key "work-ons".

Composting barns are not the only solution and free-stall barns also have their proponents, particularly in the South Island.  But for our hybrid New Zealand grazing systems, the compost barns will have lower capital cost while providing superior cow comfort and cleanliness.

One of the challenges for dairying is that as soon as one issue is addressed, the anti-dairy warriors find other reasons why we should get rid of dairying. Greenhouse gases (from cows doing what comes naturally to them) is one such issue. And there is also supposedly a looming threat from synthetic milk.

Both greenhouse gas issues and synthetic milk are big issues which are indeed too big to deal with here. They are topics for another day. 

Suffice to say I don't think either issue needs to destroy the dairy industry. There are strategies to deal with both.

In contrast, our dairy industry is genuinely threatened by its failure to get on with the long conversion process required to produce A2 milk that is free of A1 beta-casein. Many of the big farmers with multiple herds are actively converting, but the small farmers, with poorer information sources, are at risk of being blindsided. They have not and will not see the tsunami coming. I have written about that many times, and will do so again.

A key bottom line of relevance to all New Zealanders is that our agricultural resources favour pastoral farming. It is not by accident that animal farming lies at the heart of New Zealand agriculture, and that agriculture lies at the heart of the New Zealand export economy.  There are no easy alternatives. Those who hope for the demise of dairy should think carefully. 

In contrast, for most plant-based industries and also for manufacturing industries, and as a small isolated country in the South Pacific, we lack global competitive advantage.  

So, we do need to keep a focus, but not our only focus, on pastoral farming.  But that does not mean that we can prosper by doing things the way we have been doing for the last 30 or so years. As Bob Dylan once wrote and sang, "The times they are a-changin'".

- Keith Woodford is an independent consultant, based in New Zealand, who works internationally on agri-food systems and rural development projects. He holds honorary positions as Professor of Agri-Food Systems at Lincoln University, New Zealand, and as Senior Research Fellow at the Contemporary China Research Centre at Victoria University, Wellington.