KEY POINTS:
As officials chew the cud over the best way to tackle the agricultural sector's contribution to climate change, the fertiliser industry is trumpeting European research it claims discredits the option of a tax on the use of nitrogen fertiliser. But a closer reading of that material suggests the
sector might have to look elsewhere if they want to demonise such a levy as a way to combat a significant source of nitrous oxide, a potent greenhouse gas.
The spectre of such a "blunt and inappropriate" measure in the Government's discussion paper on sustainable land management and climate change earlier this year certainly raised the ire of the fertiliser fraternity - which has been doing very nicely judging by the staggering profits they posted this year amid agricultural intensification and a rising global demand for urea.
In its submission to the government, FertResearch, the industry body backed by Ballance and Ravensdown, which together account for 90 per cent of fertiliser sales in New Zealand, panned the idea of a tax as a revenue-gathering exercise.
However, they welcomed the idea of economic incentives to boost the use of nitrification inhibitors - a technology that may prevent nitrogen leaching - especially if they could be factored into an emissions trading scheme.
Above all though they sought to downplay their role in the problem, saying "nitrogen fertiliser is a small part of the nitrous oxide equation".
True in part, but not in full. While AgResearch data confirms nitrogen fertiliser accounts for just 14 per cent of the total emissions of N2O - with the majority attributed to animal waste - the gas is said to be 310 times more potent than carbon dioxide and accounts for a third of agricultural and a sixth of national emissions. Then there's the fact that nitrogen fertiliser has increased four-fold since 1990 in New Zealand.
But with a concrete climate change policy looming ever closer, the lobby group, hungry for ammunition, is pointing to an analysis of European research it says demonstrates the imposition of a charge on nitrogen fertiliser would be "futile" in discouraging its use.
According to an article in the peer- reviewed International Journal of Water : "Over the last 20 years in Europe, the price of nitrogen fertilisers has weakly influenced its consumption trends."
FertResearch claims the analysis found no discernible difference between usage patterns between countries with, and without, taxes - except perhaps in Austria - and that fertiliser demand was "more sensitive to agricultural output demand than its own price".
The industry group claims this backs up local industry data showing that urea fertiliser price increases of more than 10 per cent over 10 years had "not been accompanied by a decline in urea use".
However, reading the paper more closely, the authors qualify the results as "exploratory", adding they were established "over a short period of time".
More telling is the note that the results are based on "rather small changes in the nitrogen price level" and that "the data refer to a period when the production structure underwent great changes under the influence of the agricultural prices policy".
Indeed, rather than label taxation as futile, the paper would appear to suggest a high level of fertiliser tax could be necessary to have an impact in some situations.
"These results do not take away the relevance of a tax as a price signal towards farmers," it says. "But they incline us to account for the specific conditions of the country's agriculture when anticipating the effects of such a price signal. A lower impact in a highly intensified agriculture and a higher impact in a less intensified agriculture."
"Hence, in order to trigger a 'deintensification' change in agriculture the tax rate should be high ... "
Looking further afield, the Netherlands Environmental Assessment Agency says a tax on nitrogen fertiliser helped reduce nationwide use from 392 million kilograms to 298 million between 1998 and 2002.
FOOD FIGHT
The transtasman food fight has moved into new territory, threatening to turn the sweetest of Earth's bounty sour. But is it a case of tit for tat, just deserts or double standards?
With New Zealand threatening WTO action over Australia's continuing efforts to block apple exports vis-à-vis the threat of fireblight, our summerfruit industry is getting all wintry on our neighbour, too.
Summerfruit New Zealand, the body representing purveyors of what used to be known as stonefruit, has declared war on Australian attempts to access the New Zealand market "because of the risk of introducing fruit fly".
"Summerfruit NZ will oppose the Australian application on technical grounds and will call on all other horticultural industries to lobby government on the fruit fly risk associated with importing Australian summerfruit," declares chairman Basil Goodman. "The whole New Zealand horticulture industry will be exposed to fruit fly should it establish in this country as a result of Australian summerfruit imports"
The organisation, whose members trade in apricots, cherries, nectarines, plums and peaches, says it has "no confidence in cold sterilisation as a tool to control fruit fly", and wants the government to delay or decline the application.
Goodman said he expected that an application lodged with Biosecurity New Zealand by Australia to export apricots, nectarines, plums and peaches - but not cherries - to New Zealand would be dealt with by the end of the year.
But in the meantime he is busy amassing the troops, so they are ready for battle when the time comes.
The importation of fruit fly could severely cripple New Zealand's horticultural exports, worth around $2.6 billion, Goodman says.
And cold sterilisation failed to stop Australian produce infected with fruit fly into Taiwan three years in a row, he says.
"If that country was getting live fruit fly, how on earth can we have confidence that we're not going to get the same thing here?"
The only way to ensure that would not happen was to insist on irradiation of summerfruit from Australia, he says.
"We don't have comfort in cold sterilisation - it didn't work in Taiwan - so the only other one we know is irradiation."
Although New Zealand is now free of fruitfly, an incursion of the Mediterranean fruit fly - or medfly - in Auckland in 1996 led some nations - including China - to ban New Zealand fruit for a year. "It took quite a long time to get product flowing again," Goodman said.
Goodman says that the application before Biosecurity NZ covers the whole of Australia, meaning they could supply fruit before the New Zealand season began until after it finished.
However, it spans across parts of Australia with controls on the transfer of fruit between states to limit the spread of fruit fly.
"If they've got no confidence they can move it in their own country, how the hell can you move it to another country and give confidence?"
A recent study commissioned by Horticulture New Zealand showed a fruitfly incursion in key fruit and vegetable growing regions would cost the country thousands of jobs and millions of dollars, and cause many trading partners to suspend imports from New Zealand.
