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Incentives for Change

How Will Global Changes Influence NZ Agriculture? Inside ‘The Matrix’

The Matrix of Drivers research is being used to model returns under scenarios like increased trade liberalisation, moderate climate change, and greater awareness of international market preferences.

There are many international market considerations and national concerns that have the potential to influence land use decisions made by New Zealand’s primary producers. The Matrix of Drivers research project was established by the Our Land and Water National Science Challenge to determine where these influences conflict or are compatible, and to identify the most important drivers.

The Matrix of Drivers draws upon 650 unique sources of information (494 international and 156 domestic) of academic, industry, regulatory and legislative origin.

Domestically, environmental drivers were considered to be the most likely to affect land use change and practice, while social drivers were considered to have the least likely effect. Biosecurity, soil quality, water use and quality were the most important domestic environmental drivers, with agricultural and trade policy also important.

Internationally, analysis of more than 30 drivers for Asia, US and Europe highlighted key differences compared with New Zealand. Agricultural and trade policy were identified as important drivers, especially in the US and Europe.

Key environmental drivers internationally included water quality and quantity, air quality, biosecurity and biodiversity, chemical residues, sustainable supply and pasture-based production methods. However, the potential influence of the various international environmental drivers on land use practice and change in New Zealand varied between global regions.

Associated modelling of these data revealed:

  • A 25% reduction in trade barriers would increase returns to dairy alone by $1 billion.
  • Under a moderate climate change scenario, New Zealand would likely experience almost a 10% drop in producer returns for agriculture, these loses coming predominantly from a shift from pastoral land use. Conversely, the occurrence of extreme weather events overseas results in minor benefits for agricultural producers in New Zealand as interrupted production overseas creates higher global food prices.
  • New Zealand agricultural exports could obtain a 50% premium in key markets if producers considered international market preferences; this could result in up to a US$5.5 billion increase in total producer returns, with significant increases in returns for dairy products, and both sheep and beef meat.
  • Increased trade liberalisation globally would also have a significant positive impact for agricultural returns, with higher returns of up to 30% for raw milk and up to 20% for beef producers.

This information informed the initial Our Land and Water strategy and research portfolio.


For more on this research, see:

Author

Annabel McAleer

Senior Communications Advisor, Our Land and Water

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