Forestry can improve water quality

The Government’s new National Policy Statement for Fresh Water Management will have far-reaching, long-term effects on land management, land use and water quality. Although some perceive the minimum ‘standards’ for water quality to be lax, these are expected to tighten as confidence in applying the new framework grows.

Rural land holders face a future with tighter nutrient constraints and greater accountability to perform within specified water quality limits than in the past. Public consultation is already under way on the rules for the allocation of nitrogen (N) discharge and other limits on land holdings.

The re-allocation these rules are seeking to achieve is not trivial. For example, the current 750 tonne nitrogen load into the Rotorua Lakes each year needs to be reduced by 320 tonnes by 2032, with 270 tonnes of this coming from rural land holders. The near-term goal is to achieve 70% of this decrease by 2022, with tax and rate payers contributing $45 million towards the cost. At Lake Taupo, nitrogen inflows are to be reduced by 20% (100 tonnes per annum) by 2021, the public cost of which is $81.5 million. The ‘Healthy Rivers’ project is also underway to improve water quality in the Waikato and Waipa Rivers by reducing nitrogen, phosphorus, sediment and bacterial loads by 2030. The public cost is at least $220 million over 30 years.

It is clear that the public cost of reversing the decline in water quality is quickly mounting. The new framework for managing freshwater will ultimately see more of the cost internalised to those responsible for the deterioration in water quality. Many land owners will need to either change their management practices, their mix of enterprises, or co-operate with others in their catchment in order to meet the new limits.

This provides a great opportunity for the positive role of forestry in sustainable land management to be highlighted and better appreciated by the public and those responsible for implementing regional and district policies. Vitally, forests provide ecosystem services that counter the effects of pastoral and other high nutrient input agricultural activities. For example, trees require little or no fertiliser, store carbon, slow water run-off and mitigate flooding, prevent erosion, enhance biodiversity and improve landscape aesthetics. However, forests can generate negative environmental effects if poor practice at harvesting allows sediments and log trash into waterways, or the spread of wildings. In some catchments, forests may compete for water.

At Scion we are therefore looking at a range of technologies to mitigate these externalities and increase the economic returns from forests - such as new biotech approaches to tree breeding to generate sterile conifers, and better harvesting practices. Achieving better returns for wood processors through product diversification and efficiency gains is essential too.

We also want to ensure forestry’s negligible requirement for fertiliser does not preclude greater use of nutrients in the future as the third, fourth and fifth rotations of forests are harvested - a forest might leach 2-6 kg/ha/annum of N compared to 9-16 kg/ha/annum N for sheep and beef cattle, or 35-70 kg/ha/annum N for dairy. In principle, enterprises with a low environmental footprint such as forestry should not be strategically disadvantaged by the new rules, but rather, encouraged. In this context, profitability must be viewed from both a land owner’s and New Zealand perspective and include the ‘true’ costs to society (or externalities).

The new National Policy Statement for Freshwater Management thus starts to get to the nub of addressing the issue of externalities – some land-use activities privatise more benefits and socialise greater costs than others. In recent times, this state of affairs has disadvantaged forestry despite it being good for both the environment and the economy.

To improve our understanding of forest ecosystem services and their contribution to sustainable land use and the economy, and encourage increased forest plantings to assure wood supply (and improve New Zealand’s greenhouse gas profile) from the mid-2020s, we have significantly boosted our capabilities in resource economics and value chain optimisation. We are also increasing our focus in remote sensing, ‘big data’ capabilities and soil science to help the forest industry fulfil its economic, environmental and social potential for New Zealand.

In this edition of Scion Connections you can read about other actions we are taking to improve the forest industry’s competitiveness. You are most welcome to contact me or any of the authors listed to discuss these topics.

Warren ParkerWarren Parker

Dr Warren Parker
Chief Executive