23 Feb 2017

Is dairy worth the price we pay?

From Afternoons with Jesse Mulligan, 2:22 pm on 23 February 2017

Can we have a country that has truly clean rivers and have a viable dairy sector? If we got rid of dairy could New Zealand survive?

The government announced yesterday that it is aiming to make 90 percent of our rivers and lakes swimmable by 2040.

The degradation of New Zealand’s rivers and lakes comes from land use intensification, be it urban, industrial or rural. And the intensive dairy sector has become a significant polluter as it has grown rapidly in the last 15 years. 

Dairy Heifers

Photo: susan murray rnz

Economist Shamubeel Eaqub says if the dairy industry disappeared tomorrow New Zealand’s economy wouldn’t collapse.

“If we imagine New Zealand without dairy we wouldn’t be bankrupt we would be fine.

“For a long time we didn’t have a very big dairy industry and the economy was still growing, and still had things happening in the provinces, but when the demand for global dairy products increased New Zealand tapped into that strongly.”

Eaqub also says if dairy hadn’t taken off 15 years ago something else would have.

“It’s not like a hole in the economy, it’s not like it goes away, if dairy hadn’t taken off something else would have been doing something in that space. What’s to say it wouldn’t have been IT?”

The question isn’t should there be dairy but what kind of industry should it be, Eaqub says.

“I think we made the same mistake with dairy as we made with sheep and beef and forestry and horticulture. We still want to export volumes rather than profitable small volumes.

“Are we trying to be more profitable or are we trying to get more revenue? They are two very different things, we can have less volume and still high profits.”

Shamubeel Eaqub

Shamubeel Eaqub Photo: RNZ

And a higher value, less volume driven model would have less impact on the environment.

Eaqub says honey is an example of how things could be for dairy.

“New Zealand honey gets on average $17 a kilo compared to the global average of $5, there is nobody else even close to that.”

He says New Zealand has to shed its old mercantile mind set – to sell more stuff year on year – and it pays the price for this model with a polluted environment and a damaged national brand. 

“New Zealand is not going to go bankrupt tomorrow if we had stronger standards of water.

“Wind back to 15 years ago, our dairy sector was very small. It’s not like the land has gone, it’s not like the potential of the land has gone.

“If we are saying dairy can only exist if we abuse our resources that’s not a good enough reason for having it.”


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