Kielder.
I'm Chelsea Daniels and this is the Front Page, a daily podcast.
Presented by the New Zealand Herald.
New Zealand is a farming country and that's not going to change anytime soon. Agriculture and the primary sector remain central to our international trade, with export revenue hitting a record fifty seven point eight billion dollars in the year.
To June twenty twenty three.
That number is expected to dip when the next figures are announced as the tough economic climate is.
Felt throughout all parts of society.
Looking to get the most out of both the primary sectors here and overseas is the Minister for Agriculture and Trade, Todd McLay.
As he heads to field days this week.
The Minister joins us today on the Front Page to discuss.
The state of his key portfolios.
Minister nearly seven months into the job now, and you've been on a few international trips in that time. Hey, when you talk trade over seas, how important are our primary sectors in those discussions?
Well, two things are really important.
One primary sector is an extremely important and valuable part of the New Zealand economy. And secondly, it's a really big part of our trade profile. If you think of it this way, eighty percent of every single plane that leaves an airport in New Zealand and eighty percent of every single ship that leaves every port in New Zealand is full with the goods from the primary sector that
we are selling overseas, and that's its contribution. The second thing I think in every single market I've been in through the Middle East, Europe, and of course a lot through Asia is the very good high reputation New Zealand food and produce has has been safe, environmentally free, and increasingly now people starting to be aware that, you know, it is very good for climate change because of the
low carbon footprint that we have. And so we're just going to make sure we keep talking those things up and doing what we do best in New Zealand innovating produce great things that the world's consumers want to buy and are willing to pay more for.
Speaking of climate change, I know the government's just announced it will be keeping agriculture out of the New Zealand emissions trading scheme and will establish a new Pastoral Sector group to tackle biogenic methane.
What's the reason for this?
Well, two things.
The first is we know that our food producers are some of the most carbon efficient producers of food anywhere in the world. And if what we do to meet our climate change obligations is have them produce less or close farms down, we know that that food we produce will be picked up by some other country and they will be you know, the climate will be worse off because they are less client carbon friendly, and Zealand will be poorer and we're just not willing to do that.
But we must meet our obligations internationally to reach net zero by twenty fifty and we want to do that with the pastoral sector, which is the farmers that have
dairy and meat. We want to do it in such a way as we reduce missions without reducing production, which predominantly is around new technologies that are available overseas and yet to be here, and through investing with them in more research and commercializing some of the things that are in labs in New Zealand now that will allow us to do that.
Was the sector even a part of THEHS initiative to begin with.
Well, the previous Labor government put them in as far as on the first of January next year. In twenty twenty five, if agriculture hadn't agreed a price to tax its climate or methane production, then the ETS would swing into effect.
And we just think that's just far too blunt a tool.
You know, if New Zealand was one of the worst carbon emitters when it came to agriculture, may be fair enough, but we're not. We're one of the most carbon efficient. And all it would do is push production to the US or to Europe, where we know that for every time they produce food they emit more carbon. That would be worse for climate change. But I come back to what I said earlier. We must meet our climate change obligations.
The government has committed to that. Agriculture has said they will do their part, but we just have to do it in a way that it doesn't shut them down.
And I know that there will be many things that they're up for around.
Innovation and these new technologies that will help get us there by twenty fifty.
The sector is one of the biggest in our country in terms of emitting meeting though right.
Well, you know, agricultures is responsible about fifty percent of New Zealand's emissions, but they are not responsible for fifty percent of New Zealand's warming.
Farmers don't dispute. They're responsible for nearly half of New Zealand's greenhouse gas emissions.
And not responsible is as for half the warming.
A report commissioned by Federated Farmers Dairy and z and Beef and Land New Zealand shows that since nineteen ninety farming has been responsible for forty nine percent of total emissions, but in that time the sector has been responsible for just thirty seven percent of warming.
And that's why before the election we committed to an independent scientific review, an independent review of the science and targets of methane agriculture against additional warming, and Cabinet has made that decision already we're going through the terms of reference and we're looking for New Zealand and the world's best scientists in this area to conduct that independent review for us.
What they will do is give us.
Exactly the target of what agriculture must do, what they must reduce, or the amount they must reduce by. And you're going to remember the last government put in legislation a reduction of agricultural emissions of between twenty four and forty seven percent by twenty fifty. But that's not a target, that's a really wide band that sort of says, we don't really know what the target should be, so we'll chuck some stuff and legislation and we'll work it out
later on. Well, we've said we want the world in New Zealand's best scientists to help us make that decision. We will accept the decision, you know, the advice they come up with, and then we will work with agriculture to ensure that they do their fair shared to help New Zealand meets climate reduction obligations, and we'll do so in such a way without sending those jobs and that production overseas.
You said that the government is committing to meeting our climate change obligations, like you've just told us as well. But if farmers don't face consequences for their emissions, what incentive do they have to reduce them.
Well, one of the most important incentives is access to foreign market. And I mentioned at the beginning of our top eighty percent of what we know we sell overseas as food and fiber, it comes from the primary sector. We know that customers overseas, and certainly consumers are recly interested in the environmental and climate change footprint, and although we are one of the world's most carbon efficient food producers, that's not enough.
We need to do our fair share. And I know my conversations with the.
Processors who export as well as the farmers and their farming leaders that represent them, they know that they have to do this.
They're up for the challenge.
They're just saying that a tax on food production, which is what the last government was proposing and driving through the utets, would merely put up prices for New Zealand consumers and our supermarkets, and would make us less productive overseas and wouldn't do anything at all to help the world reduce agricultural emissions.
Well, we're being more responsible than that.
We're saying that we're going to work with the sector set up a pricing regime by twenty thirty, but make sure that the New Zealand regulatory system and our investment allows some of those solutions that are available around the world but not yet in New Zealand there for farmers to take up.
We need to embrace the technology and the tools that many other countries have. You know, there is technology that exists today as a methane inhibitor that will reduce emissions by thirty percent. It's available in thirty five other countries and it's not yet available here in Zealand. We need to give our farmers the tools and the technology to be able.
To do that.
The last government didn't seem to get along too well with the farming community at all. Hey, but Groundswell seems to be one of the few groups not protesting the government this time. What are you doing differently to work with the farming community. Do you reckon that differs from the last government?
Well, I think that most of the groups that represent farmers from you know, directly on the farm to those that have officers in Wellington, the levy bodies, all they asked was the last government was to work constructively, you know, Labor set up a hare Walker ECONO, a partnership and they said it was the first true partnership with government of farmers anywhere in the world to find solutions together
to reduce farm missions and scratching. Now, well we are and the reason for that is that the sector work for two or three years, came up with those solutions and the government said, no, we don't like it. The Labor government said we don't like it, and they destroyed any semblance of cooperation or good faith that existed. What that shows me though, is that the sector is willing to take on responsibility for itself and we are disbanding
here Walker Econoa because it's failed. It didn't achieve what Labour said it would and I'm yet to see anybody that has any faith it. In fact, even James Shaw that was a member of the last government. Now if Parliament said it didn't achieve the things that needed to,
it didn't work out. In its place, we have a new Pastoral Sector group that will be representatives at a very high level of only those farmers involved with the dairy, sheep, beef and there because that's where the methane shall and we will work constructively and focus with them on these solutions. But the sector knows and it has already said it must meet its obligations. Are They're up for that, but
they need a government that will work with them. Merely putting a tax on them that puts up the price of food and sends jobs and production over seas won't achieve that.
It'll just make New Zealand poorer.
How does it put a higher price on food though being more environmentally friendly. Do you think other nations, perhaps in exporting, wouldn't choose New Zealand because it's not doing enough for the environment.
Well, no, it makes food more expensive for New Zealand consumers and makes us less competitive over seas when we export. So think of it this way. It's a bit like that ut tax. The last government put a tax on utes. If people want to buy them and drive them, or a farmer or a tradee there is nothing else they can buy because there wasn't electorates. All they have to do is pay a tax, pass that on to the consumers or the people they're providing services to, because they're
not able to alter their behavior. In the case of the last gouvernm with agriculture by saying they were putting a price on agriculture, if there was nothing they could do other than farm less and produce less food. Then merely it puts up the price of food for New Zealanders, or we.
Are less competitive overseas.
Are here blessed to sell And as I said earlier, because we are so carbon efficient, it means the Americans or the Europeans would produce that food that world needs and with a greater carbon footprint, which is worse for climate change. Well, we're not willing to do that. But I come back to what I have said each time and repeat. We must meet our obligations. The sect there
says they're up to that. We're going to work with them on this on methane and use these new technologies and make sure the tools are available to them so that we can get to the target of net zero on behalf of New Zealand by twenty fifty.
And one of the arguments the previous government used around the emissions trading scheme and other policies was that the New Zealand trades on its clean green image and farming needs to reflect that.
Right Do you agree with that perspective?
Yes, I do, And we start from a very good point in as far as we are one of the world's most carbon efficient food producers. But we can't merely say we're better than the rest of you. Therefore we're not going to do anything. We have obligations and we have to do our fear share.
That's in it.
It's just not in the scheme of the ets, right, you're going to make them do other things. Does the clean green image come up at all when you talk with other countries.
Has that resonated overseas well?
Certainly consumers around the world recognizes that New Zealand produces very high quality save food and they recognize also that we have high environmental standards. We need to keep enforcing those and reinforcing them. But we also have to be focused on the outcome, what we're trying to achieve, rather than just a rule that often won't achieve what has been suggested or just add cost. But we are thought
of very highly internationally. It is a reputation that has developed and built upon by successive governments from the work the sector.
And farmers do themselves.
We need to support that with good regulation and enhance it, but not merely put in place rules that would create attax and not achieve the things we need to.
And if we go back overseas and talk trade for a minute, Minister, how's the mission to woo India going?
Well, it's very you look at We're in a really really good space, I think, but there's a lot of work to be done. It's fair to say over the last six to seven years, the relationship with India was underdone. Prime Minister Luxeen has been very clear we want to invest in that relationship and it is a strategic priority for the government. I've been up there very soon after the government's formed last year.
Deputy Prime Minister Peters has paid a visit.
When I was there, I met with my counterpart, the Commerce Minister, and I invited him to send a delegation of his high level officials to New Zealand to meet with my trailer officials and talk about trade more broadly, but also focus on some of the barriers that exist that make it hard for New Zealanders to export to India or Indians to New Zealand. That visit happened about a month ago. It was very constructive. Since we've come to government, the log trade has recommenced because India had
restricted logs from New Zealand. We've been able to find a few products, including mangos, that can come down in this direction. And the Prime Minister has said he will visit India within a year of becoming Prime minister, and that is scheduled with a big delegation before the end of this year. So we're making important steps forward. The end goal is a high quality trade agreement with India.
But before we can get to the stage of talking trade and negotiating, we have to strengthen the relationship and get ready for a ways that Kiwis and Indians can buy and sell more from each other.
If you had a genie pop out of a bottle and you could sign a trade agreement with any country in the world that you're working on now, who's on the top of the list.
It would be India because they're one point four billion consumers who are increasing in wealth. They're starting to trade with the world, buy and sell, and that we know that. You know that there is real opportunity for Kiwi exporters of goods and of services.
In that market.
But the other area that I think would be very important for me is rather than a trade deal with one countries, I'd want to continue to bring groups of countries together to have common rules through trade that give certainty and opens up supply chains to many more New Zealand exporters. You know, we don't have a trade deal with the US, although since they pulled out of the TPP seven years ago, our trade with them has grown
remarkably well. But we did the last week in Singapore and I was there sign a deal with fourteen Indo Pacific countries, including India and the US, which looks area to cooperate and gives greater certainty for trade and particularly investment in the green economy. That's a pretty important step forward for a small country like New Zealand. We're going to keeping out on the world stage hustling for a
better deal for keywags. It's something the prime minister election is pushing the Deputy Prime Minister and me as Trade Minister to do every single.
Day, because if it's splitzing growth rates, the fast is doing economy of the world. A country of one point four billion people who are upwardly mobile, several hundred million people coming up into the middle plus every decade. It's a huge market which cannot be ignored. In fact, it's a little surprise that it has taken New Zealand so long to come to the party.
And you're off to Field Days obviously a massive event for the sector on everyone's calendars every year.
I what are you looking most forward to?
What do you reckon the reception is to you being there will be and any announcements coming out.
Yeah, my first Field Days as Agriculture Minister. Although I've been there previously spoke and of course there's an MP many times before. It's a real celebration of the very best at new rural New Zealand has to offer. I have nothing but admiration for New Zealand farmers. You know, they innovate, they work very very hard every day, they get up so early, and they are helping us rebuild the economy and pay off a lot of the debt that's been run up. But there will be a number
of announcements as we go through the week. The Prime Minister will be there Wednesday, which is our full day, and I tell you, aside from our announcements, what he and I are both most looking forward to is being able to get out and talk to farmers directly about the things that they're doing well, the challenges that they have and what more they want from the government.
And any hints on what those announcements will entail.
Well, some of them are going to be around support on farm and new ways of doing things. Nothing overly significant, but I do have announcements towards the end of the
week around forestry. There's a forestry hub there and it's what we're doing in agriculture, given certainty, getting some of the rules that aren't working just costs, creating costs out of the way and setting up a framework so foresters as much as farmers have a clear understanding of what their obligations are and then can make decisions for themselves
how to best meet them. You know, where the cost of a regulation is greater than the benefit of the outcome, that's red tape, and the government is just not going to do that. But we're not saying we shouldn't have rules. We're saying we want better rules. We're not saying that we only want you know, fewer, we want ones that really really work. And that's the same whether it's in any part of the business community, agriculture, forestry, or actually mom and dad at home. You know, they know they
have to be rules on regulations. They want to be smarter and better. They don't just want them to be expensive and burdensome. And that's everything that David Seymour that our Prime Minister Christoph Luxan and Deputy Prime Minister Winston Peters and.
I are focused on geling along then very much so.
Tell you I've been in three governments now and this is a privilege and of pleasure to be a member of the focus around the Cabinet table on getting things done for New Zealanders and making their lives easier by having less government, but where they do need government that we work harder for them is a pleasure.
You can tell us the Gossip of tape. Thanks minister, You're so welcome. That's it for this episode of the Front Page. You can read more about today's stories and extensive news coverage at enzet Herald dot co dot z. The Front Page is produced by Ethan Sells with sound engineer Patty Fox.
I'm Chelsea Daniels.
Subscribe to The Front Page on iHeartRadio or wherever you get your podcasts, and tune in tomorrow for another look behind the headlines.