Farmers celebrate new rules limiting forestry conversions - but do loopholes remain?

Farmers are celebrating new rules to limit farm conversion to forestry. Photo / RNZ, Kate Newton

By Gianina Schwanecke of RNZ

Farmers are celebrating new rules to limit farm conversion to forestry, but worry loopholes remain.

Agriculture and Forestry Minister Todd McClay announced new legislation will be introduced later this year, placing restrictions on full farm-to-forest conversions on Land Use Classification (LUC) 1-6 land.

Under the changes, which took effect from December 4 last year, when the policy was originally announced, up to a quarter of farms can be planted in forestry for the Emissions Trading Scheme (ETS).

There will also be a ban on full farm-to-forest conversions from entering the ETS for LUC 1-5 actively farmed land, and an annual registration cap of 15,000ha for forestry entering the ETS for LUC 6 farmland.

McClay said the Government was focused on maintaining strong food and fibre production while supporting sustainable land use.

“We remain concerned about the effect that farm conversions are having on highly productive land, particularly sheep and beef farms in Northland, the East Coast and parts of Otago and Southland.”

While Federated Farmers’ meat and wool chair Toby Williams welcomed the changes, he worried loopholes remained that allow for further farm-to-forest conversions.

Williams also raised concerns about transitional measures for landowners, with evidence that they were in the process of afforestation prior to the announcement, such as ordering seedlings.

“The idea that buying seedlings before December 2024 is an intention to plant is an absolute joke,” he said, adding it created a loophole for exploitation.

“If a forester didn’t own the land, they can’t have had any real commitment to plant it.

“Having a contract on seedlings shouldn’t be accepted.

“We’re also hearing stories of farmland being bought for conversion to forestry, with the intention of on-selling to foreign investors to get around overseas investment rules.”

Williams said forestry was important and he wanted to see more processing and value-added programmes in New Zealand - his concerns related to the loss of productive farmland.

New Zealand Forest Owners Association (FOA) president Matt Wakelin said the new planting rules were creating “uncertainty” for forest owners, with nurseries already reporting reduced demand for seedlings.

“New Zealand forest owners are supportive of integrated land use where farming and forestry can co-exist, however, this new policy appears to restrict forestry rather than recognise it as a vital primary industry and core contributor to climate mitigation.”

He said the moratorium on full farm afforestation and the limiting of planting on Land Use Classes 1-6 was “unduly hurting” forest owners, and much of New Zealand’s LUC6 land was ill-suited for food production but ideal for planting trees.

“The restrictions placed on LUC6 land pushes planting of trees to marginal or less productive land, which will have an impact on future timber and fibre supply, jobs and forestry’s ability to support New Zealand in meeting its climate change obligations.”

Wakelin said the changes also added another layer of complexity to the ETS, and more clarity was needed.

- RNZ