The Overseas Investment Office declined a consent for a Swiss company Corisol New Zealand to converta sheep farm on rolling hill country in Otago to a 473ha production pine forest by the end of next year.
Corisol claimed the investment would benefit New Zealand by assisting in meeting its nationally determined contribution to climate change and advancing significant government policy, as well as increasing job opportunities, export receipts, biodiversity and public access.
The consent was declined as the decision makers, Land Information Minister Damien O’Connor and Finance Associate Minister Barbara Edmonds, were not satisfied the likely benefit was proportionate to the sensitivity of the land and the nature of the overseas investment.
Land Information New Zealand considered the investment would benefit New Zealand, although it was unclear if the benefit was sufficient to meet the benefit to New Zealand test, the decision said.
The application was one of the first made under the benefit test for the conversion of farmland to forestry since the Overseas Investment Act was changed in August last year.
The location of the Otago farm was redacted from the decision but the distances of the farm from potential markets remained, including 46km from Pan Pac Pacific in Milton and 51km from both Fonterra Stirling in Kaitangata and Odlins wood processing in Mosgiel.
The farm runs more than 3800 Perendale-cross ewes, about 1100 hoggets and includes 80ha of pine forest.
The decision states Corisol New Zealand owns more than 20,000ha of land in New Zealand, predominantly used for forestry in Otago, Canterbury and Northland.
Since 2019, Corisol New Zealand has made five successful applications to acquire about 2240ha of land in Otago through the special forestry test, the decision states.
Federated Farmers Otago meat and wool chairman Logan Wallace, of Waipahi, said it felt for the farm owner who had the sale of their property fall through.
“We feel for that farming family, but we are happy a higher bar for overseas conversion of New Zealand farmland is going to lead to better long-term outcomes for our communities.”
A report commissioned by Beef + Lamb New Zealand on the land-use change from pastoral farming to large-scale forestry was released last month.
