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Environment
Jack Santa Barbara

Why NZ's record high exports are cause for concern

For the first time, more than $50 billion in revenue has been generated by NZ exports - including a record high of $21.6 billion for dairy. Photo: Getty Images

Jack Santa Barbara asks just how much food and fibre can we produce without destroying our biocapacity

Comment: New Zealand's food and fibre exports are about to reach record highs in terms of revenue generated, prompting optimism in both government and industry circles. According to the Government’s latest Situation and Outlook for Primary Industries Report, for the first time, more than $50 billion in revenue has been generated by these exports. These include record highs for dairy ($21.6 b), meat and wool ($12.2b), horticulture ($6.7b), and seafood ($1.9b). Forestry products ($6.2b) declined somewhat but are expected to pick up soon.

There is no denying the importance of these sectors to New Zealand’s economy. But are these results the success they appear to be?  Are their ecological costs being taken into account?

Food and fibre all come directly from nature. Nature produces the biomass from which we derive our food, fuel and fibre. Ultimately, our wellbeing is utterly dependent on this biomass. One of the wonders of the web of life is that it produces continuous sources of food, fuel and fibre, and continuously absorbs waste. To be sustainable, how much we use up on an annual basis (via harvest and waste production) must be less than nature provides over the same period.

But how does the way we produce this biomass (dairy, meat and wool, etc), and then export it, impact our ability to continue operating sustainably in the future?

An empirical way of measuring biomass production, along with nature’s other most significant gift to us, waste absorption, is the ecological footprint measure. The concept of biocapacity includes both the production and absorption functions of natural systems. 

Biocapacity can be expressed in terms of global hectares (gha) - the amount of productive surface of the earth. The earth has a finite number of productive global hectares (about 12.2 billion) to provide biocapacity, and we can compare what is available with how much we actually use and how much we leave for other species. This is what the Ecological Footprint captures.

New Zealand: Global hectares per person (2018)

Data Sources: National Footprint and Biocapacity Accounts 2022 edition (Data Year 2018); GDP, World Development Indicators, The World Bank 2020; Population, U.N. Food and Agriculture Organization.

The above graph shows two important aspects of New Zealand’s biocapacity. The red line shows our ecological footprint; we used about 5.3 gha per person in 2018, out of the approximately 8.9 ghas available to each of us.

Given that our economy in general, and our exports of food and fibre in particular, have grown over the last four years, our current footprint is likely larger now than the 5.3 gha shown.

Even a slightly larger footprint today may not be a serious threat if we compare what we use to what is available - the green line in the above figure. 

But the second important point from the above figure is that the green line, representing New Zealand’s biocapacity, our natural systems’ total capacity to both provide resources and safely absorb wastes, is declining. 

Since 1960, this country's biocapacity has declined significantly, by more than half. A major portion of this decline is because of the ways we produce biomass, and because we export so much of it.

Keep in mind that “biocapacity” is another way of describing the entire web of life that is the most unique feature of planet Earth. As far as we know, this web of life is unique in our solar system, and perhaps unique in the universe. Yet we are destroying its capacity to continue supporting us and other species.

In natural systems, new biomass each year performs two basic services. It enhances an ecosystems’ capacity to continue providing various ecosystem services, such as food for multiple species, or flood protection and carbon sequestration from forests (a waste absorption service). It also adds additional nutrients to the environment for the production of future biomass.

In natural systems, a great deal of biomass production ends up as waste as it decomposes and provides nutrients for the next cycle of production. By exporting large portions of biomass each year, we are limiting nature’s capacity to regenerate because of the missing biomass. This is evident in the above figure in the declining biocapacity curve.

Some of the damage is from soil degradation and the expensive importation of artificial fertilizers.

A portion of the biocapacity decline is also due to the growing waste management problem we have with our greenhouse gas emissions, a considerable portion of which comes from food and fibre production.  Our per capita emissions are amongst the highest in the world.

Increasing levels of water contamination and soil degradation are significant costs resulting from the way we produce the biomass in the first place.

The amount of biocapacity we are consuming is slowly rising, and what nature can provide annually is declining. If we continue along this trajectory in the not too distant future, these curves will converge. When they do, it would mean we are consuming more than nature can provide for us annually.

The above figure suggests this is the path we are on - consuming more of nature annually than it can regenerate. This is possible because of the enormous stock of natural resources nature has accumulated or replenished over the millennia. But it is not a situation that can endure for long. It means not only eating our seed corn, but actually reducing nature’s ability to provide the proverbial seed corn in the first place.

For a small nation far from other nations, this would seem to be a very precarious situation. We would become dependent on distant sources for our basic needs of food, fuel and fibre. Such dependencies generally come with political strings attached we might not be happy with.

Converting natural capital to financial capital has obvious short-term advantages. But there has to be a limit to such conversions if we are to continue with a biocapacity excess, and retain what independence we have from foreign interference. If we continue to enthusiastically exchange natural capital for financial capital and end up with a biocapacity deficit, we will not only be operating unsustainably, but also become financially dependent on others. The current trajectory indicates this could occur well before the end of this century.

Why would we want to give up our self-sufficiency in the basics of food, fuel and fibre?

Currently, New Zealand is one of few nations on the planet with a biocapacity excess, a very enviable position. The world as a whole has a biocapacity deficit - it consumes more biocapacity annually than nature produces over that period. Hence we have a ready market for our biomass exports.

Globally, the situation is untenable in terms of a sustainable future. By continuing high levels of exports we enable other nations to avoid coming to grips with their own overconsumption of natural systems. It also puts us on track to join them in the biocapacity deficit club. In the long run it is doing neither them nor us a service. Celebrating growing food and fibre exports could be celebrating a Pyrrhic victory.

These concerns regarding our food and fibre exports do not call into question whether this country should be producing and exporting food and fibre. The more we, and the world, can operate by relying on sustainable harvests, the brighter our future. But current biomass harvests are not ecologically sustainable, and practices need to change to make them so.

This country's current biocapacity excess could allow us to play an important role in assisting other nations to transition to sustainability, by strategic use of our exports. We could, for example, prioritise exports to nations who demonstrate serious efforts in transitioning to a sustainable footprint.

These considerations do raise two serious concerns: are we producing food and fibre in ways that enhance or destroy our biocapacity? And just how much food and fibre can we produce without destroying our biocapacity?

Current evidence regarding our ecological footprint, as well as multiple studies regarding our greenhouse gas emissions, biodiversity loss, water contamination and soil degradation, indicate we are failing on both counts. We are not generating biomass sustainably, and we are producing too much for ecosystems to bear.

The way we produce biomass, and the levels of our food and fibre exports may well be examples of economic activity being uneconomic. Ecological degradation inevitably leads to economic decline.

Our current food and fibre exports remind one of the Midas touch. King Midas was overjoyed that the royal sorcerer had conjured him the ability to turn whatever he touched into gold. It was a cause for great jubilation, until he hugged his daughter.

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