What should Murray Dairy Farmers do about Climate Change?
Conclusions from Confidence to Grow
In 2008 Dairy Australia funded a package of work called “Confidence to Grow” to rapidly build up industry knowledge about climate change and climate challenges. The project focussed on answering questions like: how well positioned are we to manage climate change? are our systems resilient enough for what we might see in the future? and how can dairy be on the front foot, capture emerging opportunities and avoid any pitfalls?
There were two high level conclusions – conclusions that have not been changed by anything the science says or that the Government or the Opposition have proposed:
- Climate variability is the real farm management challenge! Managing week-to-week, season-to-season and year-to-year variability is and always has been an essential part of sustainable dairy farming. If the climate becomes more variable (or if the extremes of climate become more extreme), the management challenge will increase, but the basic skills associated with managing variability and risk (climate, costs, returns etc) remain the same.
- Focus on current efficiency and profitability! Realistically, there is no point worrying about what might happen in 20 years – unless you are efficient and profitable now, there is little chance you will be in the industry then! More seriously, the most efficient systems are not only likely to be the most profitable, but are also the systems that minimise greenhouse gas emissions per litre of milk. Back calculations indicate that in the last 30 years, improvements in on-farm efficiency (from better nutrition, better health, better genetics, better whole farm management etc) have reduced methane per litre of milk by almost 1% per year. For most of this time, few farmers had even heard of methane and were certainly not managing specifically to reduce it. They were however focussed on increasing efficiency and profitability, which lead to a reduction in methane at the same time. Increasing efficiency remains the appropriate focus.
Apart from those two general messages, we recommend the following specific actions for dairy farmers:
- Don’t get caught up in the media ‘debate’ – perhaps understand that the overwhelming majority of climate scientists agree with the concept of human induced emissions influencing the climate, but ignore the day-to-day intrigues in the media. There are strong vested interests and financial forces at play that will extend the ‘debate’ for many years regardless of the science. Let others, with more time, or with more at stake, get involved in the media debate. The IPCC (International Panel on Climate Change) only reports every 7 years so major international ‘conclusions’ are not frequent!
- Wait for clearer policy signals from the Government – both sides of Federal politics in Australia are committed to reduce national emissions through direct and/or indirect means and there will be some impact on dairy farm(er)s. However, in the face of current regulation uncertainty, it is sensible to avoid making any investments that are not consistent with best practice or sensible business decisions for efficiency and profit. In addition, there are no plans at this stage from either side of politics to include on-farm emissions (ie methane and nitrous oxide) in any compulsory schemes.
- Respond to the clear signals that are there – Dairy Australia (with DAFF and State Agency partners) is sponsoring Future Ready Dairy Systems (link to FRDS) demonstration activities in each of the 8 dairy regions. While many of these activities focus on more efficient use of water or nutrients, there is a strong demand from farmers for information about how to reduce energy use (ie cost) on dairy farms as there are already clear signals about rising electricity prices and these signals will only become stronger when there is a price on carbon pollution.
- Understand current/individual vulnerabilities – its good business to know what risks your business is vulnerable to and prudent to take steps to manage/reduce that vulnerability. Climate impacts can be direct (eg droughts, floods, heat waves etc) or indirect (eg low irrigation allocations, higher costs for bought in feeds, financial incentives to reduce emissions) and individual businesses will be more or less challenged by these risks compared to others.
- Build confidence in the future by being flexible and resilient – no-one can accurately predict the future, so no estimates about climatic (or other!) conditions in say 2030 are going to be exactly right, and the road towards that future will be paved with many unexpected bumps. The key personal/business characteristics that are essential to surviving/thriving, no matter what the future holds are flexibility to respond to the challenges, and resilience in the face of those challenges.
- Move to adopt ‘obvious’ technologies, especially low cost ones – despite point b) above (wait for clearer signals) it is prudent to recognise that the underlying climate trends across most dairy areas have been well established for decades, getting warmer and drier over time. Bureau of Meteorology records show that in the decade from 1960 there were an average of 10 new, high temperate records per year set across Australia – in the decade from 2000, there were 23 per year. Against this background there may be some obvious technologies that are relevant to your farm. As a simple example, if you are thinking about installing technologies to reduce heat stress in your herd, then you can be reasonably confident that the future will be hotter than the past and so your investment is likely to be of more value in the future.
- Keep informed/be alert (not alarmed) – it is highly likely that over the next few years there will be many ‘opportunities’ marketed to dairy farmers associated with potential payments for reducing greenhouse gas emissions and/or sequestering carbon into soils. Dairy farmers should approach all of these opportunities with considerable caution. For example, Dairy Australia has extensively reviewed the potential opportunities for dairy farms to sequester carbon in the soil and reached two clear conclusions. Firstly, there are few opportunities in long established pasture situations because the level of soil carbon has often reached an effective peak. Secondly, the costs/risks associated with keeping any sequestered carbon in the soil for the next 100 years is a major liability that will pass to future generations or to future purchasers of your property. Look for proven science, registered methodologies and understand your future liabilities. If you want to take a punt, make it small until you know how it impacts on your profitability.
- Focus on current efficiency and profitability – ie go back to the top of the page. Future profitability relies on efficient use of resources and there is no better preparation for the future than making a solid profit now. The clear message from NZ and particularly from research done on Lincoln University Dairy Farm is that farmers are better off to focus on production, productivity and profit and then pay for any greenhouse gas emissions liability under their trading scheme. In other words, if dairy farmers focus on greenhouse gas emission reduction strategies as their main target, then profitability reduces considerably. Though the policy settings are likely to be different in Australia, the conclusion to focus on efficiency and profitability will not.