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Opinion: Irrigation holds key to future farming viability

Water issues polarise people, not just in Canterbury but throughout the country. The debate is inextricably entwined with water quality and the link to dairy farming and irrigation.

New Zealand relies on the agricultural sector to provide economic success.  And in turn the sector relies on effective irrigation techniques and investment to increase land productivity, which also enhances capital value.

Dairy farming is the highest and best use of land within larger irrigation schemes but there have been periods when intensive arable land use has competed strongly on economic terms.

Dairy farming doesn’t in general mean poor environmental management. The majority of farmers see themselves as guardians of the land with a strong commitment to sustainable best practice. Many have worked their land for generations and understand the need to preserve and maintain it.

In November, the Parliamentary Commissioner for the Environment, Dr Jan Wright, released her report on water quality. It focused on how changes in land use are affecting water quality. After a modelling exercise, she came to the conclusion that, without further intervention, water quality will deteriorate in many catchments.

It was heartening therefore to see the release of Environment Canterbury’s Land and Water Regional Plan in December. It announced the implementation of new rules to improve the quality of water by managing nutrient levels. The message was clear that the impact on water quality will not be immediate and that the plan is about outcomes rather than inputs.

The plan does not dictate how land users will manage their business but it outlines rules that will need to be met if targets are to be met.

Once those take full effect, the council will require farmers and land users to manage their operations and improve their environmental performance so that over a period the decline in water quality is reversed.

The plan follows an update on irrigation hosted by Crighton Anderson in early November. At that session, Environment Canterbury commissioner David Caygill said while an improvement in water quality was required, the focus would be on achieving sustainable outcomes rather than dictating management techniques. 

This is an incredibly sensible approach. The commissioners are in effect acknowledging the expertise of farmers and agriculturalists to manage their own land in the most appropriate way that will ensure good outcomes. Essentially they are promoting a win-win situation.

What is also interesting in Canterbury is the commitment from key players to achieving community consensus through effective engagement over water management issues. While this takes time in the early phases of a development, it can significantly decrease downtime during the consent phase. 

New developments are harder
For a range of reasons, it is proving increasingly difficult to establish greenfield irrigation developments. This is despite estimates that suggest the potential economic benefits of large-scale developments indicate an additional 420,000ha of irrigated land could be made available nationally. This could boost to exports by $4 billion a year by 2026.

These figures are compelling.  Yet, while good progress has been made in Canterbury on several schemes since the adoption of the Canterbury Water Management Strategy, many industry participants have expressed some frustration at the pace of development.  

Most of the easier and more viable schemes have been completed or are in various stages of development. This leaves brownfield development as a viable option and one that can have a real impact on the key issues of sustainability and water quality. Brownfield development enables maximisation of capital that is already employed.

Projects such as shifting from traditional border dyke development to spray irrigation can bring positive benefits from both a capital return perspective and also from a water use and environmental point of view.

Development of on-farm storage and storage ponds, such as those changes under consideration through the RDR scheme, mean that water can be preserved during times of high rainfall requiring less input during drier months.  Good system design, installation, operation and maintenance of irrigation infrastructure will add value, maximise efficiencies and assist with environmental sustainability. Farmers and agriculturalists know this.

Ngai Tahu Property has demonstrated how this can be achieved with its Eyrewell development, which is predicated on sustainable farming practices to ensure good outcomes. Lincoln University and Ngai Tahu have formed a partnership where Lincoln will provide a three-year programme of environmental, biodiversity and water resource monitoring at Eyrewell.

Nutrient levels in waterways are its main concern so nitrate levels and loss is to be monitored. There are both existing and developing techniques to reduce nitrogen leaching.

This type of large-scale development and commitment does have associated and significant capital costs and for that reason I anticipate increased consolidation of properties to increase volume and unit size to enable farms to remain economically productive.

Increased irrigation does not have to be at the expense of environmental outcomes. Both can be achieved. Farms need to enhance their productivity if they are to remain viable and enhanced irrigation assists with ensuring economic land use.

Tim Crighton is director of Crighton Anderson Property & Infrastructure, a capital asset valuation and advisory firm 

More by Tim Crighton

Comments and questions
4

Hmm, there are unanswered question in terms of farm run off (the main culprit in terms of water pollution being cow's urine) vis a vis the Rule of Rylands v Fletcher and the strict liability test that it established when something noxious escapes from one property causing damage somewhere else. Crighton's comment about the expertise of farmers to manage THEIR land has to be viewed through the prisim of OUR waterways paying a heavy price to produce the white gold.

Rylands and Fletcher case 1868: the defendant was judged guilty of trespass and the commissioning of a nuisance [when water escaped from his reservoir into disused mines on a neighbouring property ... ] http://en.wikipedia.org/wiki/Rylands_v_Fletcher

Interesting argument, however, this principle of the English law of torts has since been watered-down in a number of jurisdictions:

The tort of Rylands v Fletcher has been disclaimed in various jurisdictions, including Scotland ... and Australia, ...
http://en.wikipedia.org/wiki/Rylands_v_Fletcher

Most of this commentary is historical.

The aggregation that is happening in the industry suggests an increasing number of owners are off site, and more concerned about current productivity rather than long term sustainability.

Historically, the use of land has been driven by its soil type, climate and availability to water. This model is sustainable.

Bringing in irrigation will improve the lands utility, but at what long term cost, and I question its sustainability.

These costs are now plain to see. Polluted waterways. Effectively increased costs to other users; tourism, domestic water users, etc

As far as I can see, the only benefactor has been the overseas banks. The cost of this new farming infrastructure has been increased business for them, while wider society wheres the cost of polluted water. The true cost of water suggests current dairy land prices are way over the odds. And it might be time the banks took a haircut.

Follow the money, because its a greed of the few that are causing most of societies problems.

Richard you are making wrongheaded assumptions on many levels: nearly all landowners in Canterbury live in Canterbury, they care about their farms; you forget the economic benefits towns like Ashburton have enjoyed as irrigation has increased and farm productivity improved, farm servicing and further processing have all benefited; there are only approx 80 farms throughout NZ converted to dairying each year now, this is less than 1% of the total number of dairy farms in NZ; the banks have already tightened up their criteria for lending to dairy conversions. Please start doing some actual homework on land use change in NZ before you start voicing un-informed baseless opinion.