Is diversification always better for New Zealand farming? The trade-offs explained – Dr Jacqueline Rowarth

New Zealand should also diversify its export destinations to reduce dependence on specific countries.

And farmers should diversify activities to increase income streams and reduce reliance on individual sectors.

But every “extra” takes energy, time and brain power.

An article this year in Harvard Business Review explains that although stress can sharpen performance briefly, over time it erodes judgment, narrows perspective, and increases the risk of costly missteps.

That’s why investors have portfolio managers, New Zealand has the Ministry of Foreign Affairs and Trade, and farmers have … survival instincts.

The latest survey of rural people by researchers at the Bioeconomy Science Institute (ex-Landcare Research) reports that there are already three commercial activities on most farms (3.1 where the decision-maker is 55 and below, 2.6 in the older category of 56-71, and 2.3 in the age group above that).

Further data from Landcare indicate that over the last 10 years, land use has changed categories; the biggest change has been to different kinds of forestry for timber and carbon, and tourism.

Not food.

Britain’s most famous farmer has shown why.

Despite the fact that Jeremy Clarkson has “Cheerful Charlie” advising him (and Kaleb Cooper telling him he’s wrong), Diddly Squat Farm relies on tourists to the pub to make money.

Farming is hard (and Lamborghini tractors don’t make things easy).

Despite the grim reality, there are many publications suggesting that when farmers adopt diversification strategies, particularly those that promote soil conservation and the cultivation of diverse livestock mixes, they feel they have better food security and improved wellbeing.

In research covering studies in 11 countries, the 59 authors from Europe, Canada, North America, South America, Indonesia and Africa found that benefits were even greater on farms that implemented multiple diversification strategies, as opposed to just one.

Overall, the findings suggest that diversified farming systems are good for ecosystems, as well as producing “happier, healthier, and better-fed humans”.

Similarly, research led by Australia reported that there can be benefits.

In the 88 studies reviewed, two-thirds showed benefits in diversity. One third did not.

The authors suggested that “diversity can be an important driver of food security, but the magnitude of the contribution depends on the broader socio-economic and biophysical characteristics of the local farming system”.

Context is everything, and the difficulties inherent in managing diversity were emphasised in both reports.

The 11-country research acknowledged that many farmers must work “against the odds”, overcoming myriad structural and financial barriers that make diverse agriculture a struggle to achieve.

The Commonwealth Scientific and Industrial Research Organisation research stated that diversity can increase the workload for members of the household.

In contrast, specialisation can reduce costs, increase efficiency through economies of scale and give farmers a comparative advantage for selling their produce at markets.

More information on diversity has been provided by researchers from America.

They reported that under a diverse system they could produce protein for humans and build organic matter in the soil, plus support biodiversity.

But to produce the same amount of protein as a conventional system would require 2.5 times as much land.

It is a big “but”.

Listen to Jamie Mackay interview Dr Jacqueline Rowarth on The Country below:

Turning New Zealand’s comparative advantage in soils, climate and people into a competitive advantage has been the focus of farmers, rural professionals and scientists for decades.

Unlike most countries where farms are mixed enterprises traditionally supplying the local village and taking things to the market town for sale, New Zealand farmers have considered what the land can support and what the overseas markets want.

And we do have agricultural diversity across the country.

What we don’t have is the natural resources to produce pulses, rice, sugar and tropical fruits (including chocolate and coffee) at prices that people consider affordable.

Nor do we produce cereals, canned peaches and processed vegetables competitively – they are imported from other countries that have a competitive advantage due to climate, economies of scale and regulatory environment.

The American “multi-species” research authors asked whether society should “prioritise an input-intensive, conventional [for America] system that produces more food from a smaller yet degrading land base? Or, alternatively, should systems such as multispecies pasture rotation that produce less food on a larger, but more ecologically functional landscape be more highly prioritised?”

In New Zealand, the question is whether we continue the current trajectory to increase the export economy (and Kiwi incomes) through ever-more efficient production of the animal protein the world appears to want or consider subsidising the sectors that are struggling.

Diversity of approaches comes at a cost that has to be borne by society, whether society realises it or not.