Selling Northland farms to foreign-owned companies to convert into forestry is not good for the region or the country, a Northland farming leader says.
Federated Farmers Northland President Colin Hannah is angry that more than 4660 hectares of productive farmland in the region have been sold to foreign-owned companies to convert into forestry under the Government's special forestry test.
Farming groups have expressed alarm at the rate of farms being sold through the special forestry test introduced in 2018 to encourage more tree planting.
The Government is reviewing the test as the Overseas Investment Office (OIO) continues to approve sales. Seven Northland farms have been sold for forestry since the test began, including one in March this year.
Four of the farms sold for a total of $23,468 million but the prices of the other three were withheld under the Official Information Act.
The farms cover a total of 4661.527 hectares - the vast majority of which will be converted into forestry, much to Hannah's frustration.
He said the sales are already causing issues that will be compounded if more farms are sold for forestry.
''The forests will not create as many jobs [as farming] with work for planting, pruning - if they do any, and harvesting but most of that is done mechanically."
Hannah claimed all the profits would be taken overseas.
"As well, the companies will be earning big carbon credits for the forests but they will be selling those credits overseas so there's no benefit to New Zealand,'' he said.
In addition, Hannah spoke about the wider ramifications the sales had for the industries and towns that supply farms.
''There'll be no new vehicles or sandwiches from the local cafe, no money spent on fertiliser etc.
"This is not good for Northland or New Zealand and it should stop. That's all money coming out of the local economy while these companies take their profits back overseas," he said.
''Forestry blocks would also pay lower rates to the local council than farms, so the councils would need to recover that lost money from somewhere - generally other ratepayers.''
Hannah said taking away productive land took away the country's ability to feed itself and the world.
''In 2017 there were 1135 dairy farms north of the Harbour Bridge. By the end of June this year there will be 800 and 20 per cent of the country's beef comes from north of the Harbour Bridge. You can imagine what taking 4660 hectares away - that's about 8000 animals - from that food production will do,'' he said.
''We are really pissed off about it and this doesn't add value to our region or country.
''This is very short-sighted and the Government should stop it or be taxing the hell out of these people.''
The Government announced in February that it was planning on making changes to the legislation by taking steps to ensure forestry conversions by overseas investors are of better benefit to New Zealand.
This will help ensure the right forest is planted in the right place for the right reasons, Associate Minister of Finance David Parker said.
"The changes to the Overseas Investment Act 2005, approved by Cabinet, mean proposals by overseas investors to acquire land for conversion to production forestry will be considered under the Benefit to New Zealand test, rather than under the streamlined 'special forestry test'," Parker said.
This change will apply only to forestry conversions, such as where overseas investors look to acquire existing farmland for planting into a new forest. There is no change to investments in pre-existing forests.
The Bill is expected to be introduced to Parliament in a few months. At the same time, some minor and technical improvements will be proposed to the Act to help with the operation and effectiveness of 2018 forestry-related changes.
National's agriculture spokesperson Barbara Kuriger said she shared many of the concerns of farmers over the loss of productive farmland for forestry.
She said it was a fine balance, but she wanted to ensure that the right land was being used for the right purpose. She did not want to see the country's most productive farmland converted to forestry.
Kuriger said National was working on how it would deal with the issue, but it was complex.
''We are aware of the concerns about where this has been going. There are two main concerns - they are taking up good food-producing land, and the fear is what will happen if they walk away and the forest becomes a fire or pest risk. Those would potentially ruin rural communities such as in Northland.''
She said she knew the Government was also trying to come up with a solution, while National was working on its own fix.
''I believe the Government really wants to solve this, but the reason they haven't is that it's so hard.''
■ The special forestry test is used when an investor is looking to invest in production forestry for harvesting. It was introduced in late 2018 in a bid to support the Government's forestry priorities, including more tree planting.
Farming groups have repeatedly called on the Government to urgently review foreign investment in forestry, saying too much productive farmland was being lost.
Figures provided by the OIO show between 2019 and 2021, 36,000 hectares of farmland nationally was been approved for sale to overseas investors.
Northland farm sales for conversion into forestry since 2018:
June 10, 2019:
Kauri Forestry LP, ownership Switzerland (93 per cent), Germany (7 per cent) bought 1,876 hectares of land at Lucas Rd and Pokapu Rd, Moerewa, currently known as 'Moerewa Station'.
Plan: The applicant will subdivide and sell two areas of flat farmland with dwellings not required for forestry activities (275 hectares combined), and plant and maintain a commercial forest of radiata pine over approximately 1,175 hectares of the remaining land.
Kauri Forestry LP bought 309.6100 hectares of land at 471 Moore Road, Pipiwai, Whangārei.
Plan: The applicant intends to plant 223 hectares and retain 42 hectares of native bush. The balance of 44 hectares contains land not suitable for forestry planting (including ridges, gullies and setbacks, and roading and tracks, and non-productive scrub areas).
October 16, 2019:
Kauri Forestry LP bought 488.5360 hectares of land at 481 Moore Road, Pipiwai.
Plan: Kauri intends to plant 235 hectares in pinus radiata and retain the existing forestry and native bush areas (201ha in total).
October 5, 2020:
Kauri Forestry LP bought 329 hectares of land at 26 Baker Road, Maungatapere, Whangārei.
Price: Withheld under s9(2)(b)(ii) of the Official Information Act 1982.
Plan: The applicant plans to convert the majority of the land to forestry by establishing and maintaining plantation forest (predominantly radiata pine) over approximately 240 hectares.
The applicant has identified approximately 40 hectares on the better contour of the land that has the potential for subdivision and sale as lifestyle blocks.
November 12, 2020:
Kauri Forestry LP bought 624 hectares of land at 20 Boyd Road Waipū.
Price: Withheld under s9(2)(b)(ii) of the Official Information Act 1982
Plan: The applicant plans to convert most of the land to forestry by establishing and maintaining plantation forest (predominantly radiata pine) over approximately 299 hectares.
June 8, 2021:
Corisol New Zealand, ownership Switzerland (100 per cent), bought 332 hectares of land at 672 Omamari Rd, Omamari.
Plan: The applicant intends to plant approximately 270 hectares of the land as a commercial forest. Approximately 13 hectares of the land containing a residential dwelling will be subdivided from the land and sold to a third party.
March 28, 2022:
Totara Forestry LP, ownership Germany (81.54 per cent), Finland (12.12 per cent), UK (3.84 per cent), various regions (2.5 per cent), bought 702.3817 hectares of land located at 1758 Omana Road, Kaipara.
Price: Withheld under section 9(2)(b)(ii) of the Official Information Act 1982.
Plan: applicant intends to convert the land to commercial forestry, establishing and maintaining rotational forest (predominantly Pinus radiata) over parts of the land assessed as being best suited to forestry. The applicant has estimated approximately 517 hectares of the land is best suited to planting after allowing for existing trees.
The OIO said no applications to buy farms to convert into forestry in Northland were declined.