Eric Watson suggests we have reached the maximum production capacity. ¬†We can not really make more. ¬†So what next?
New Zealand has led the world developing technologies to maximise output from our limited land resources. Unfortunately, I believe we are close to reaching the geoclimatic and biological limits of our “pasture-based” model.
The reality is, the gap between the maximum potential yield of New Zealand’s pastures and utilisation of this pasture has diminished to the point where little incremental growth in production is possible without alternative feed sources.
It is no surprise that continued increases in dairy production have gone hand in hand with significant increases in the use of imported supplementary feed stuffs, such as palm kernel which, with increased rates of applied nitrogen, contribute to nutrient loading on dairy farms.
New Zealand is caught between the necessity for economic growth and our obvious geoclimatic limitations.
As an isolated exporter of commodity dairy products, our opportunities to add to our export value without increasing volume is limited, but to maintain our market share we need to increase volume.
New Zealand’s dairy exporters have continued to explore opportunities for value-added products to increase our export values, but these initiatives are dwarfed by the impact of volume in the major commodity dairy products we export, and ultimately this is what motivates our farmers and the dairy industry.
The key here is the ability, or rather the efficiency, of ecosystems to convert nutrient inputs into product.