The economic impacts of declining pasture harvest on Northland and Waikato dairy farms

Estimated pasture and crop eaten in Te Tai Tokerau (Northland) and Waikato is decreasing at approximately 0.5 - 1.0 tDM/ha/decade, respectively. espite the falling pasture harvest, milk production has been relatively constant over time due to increased supplement use and farm system changes. Declining pasture harvest trends driven by climate change are likely to continue, and it is essential to understand the impact of this decline on the economic performance of the pastoral sector and to what extent farmer adaptation or potential for enhanced action may mitigate the impact. We combine farm-level data of estimated pasture harvest losses with the Dairy Sector Pathways (DSP) model to estimate how pasture growth may change on dairy farms in Northland and Waikato/Toi Moana (Bay of Plenty). We construct two future scenarios, ‘business as usual’ (BAU) and ‘farmer adaptation (FA).’ Under BAU, pasture growth losses continue at the same rate, offset by increased supplement use. In FA, farmers integrate alternative climate-resilient pasture species into their system, partially mitigating the pasture growth losses experienced under BAU by adopting emergent innovations. We find excess net present value (NPV) associated with FA over that of BAU of $1.3b across Northland, Waikato and Bay of Plenty regions. The estimated pasture losses are not faced by dairy alone, with the wider pastoral sector requiring forages resilient to climate change. Developing forages resilient to climate change might seem like a problem specific to Northland, but given enough time, regions to the south may face similar conditions. Therefore, identifying resilient forages and designing adapted farm systems supported by extension networks is critical to the future of pastoral farming in New Zealand.