Dutch dairy farmers will from next spring have access to the first of possibly two new tools that could potentially reduce methane emissions from cows by around 30%.

Next breeding season they can access semen from low methane emitting bulls, the result of an eight-year programme run by Wageningen University & Research in the Netherlands.

For the past four years researchers have collaborated with Dutch dairy company FrieslandCampina and genetics company CRV to establish breeding values for methane.

This measure alone is estimated to reduce average emissions by 1%  each year, accumulating to more than 25% by 2050.

University scientists are also working on a project to utilise rumen fluid from cows that are naturally low enteric methane producers.

This rumen fluid is fed as a probiotic to newborn calves in a five-dose course.

It has been found to permanently adjust the recipient’s microbiome, providing a further 10% reduction in methane emissions.

Scientists are by nature conservative, but the team at Wageningen are encouraged their work could make a tangible reduction in livestock methane emissions.

“I am quite optimistic,” said senior researcher Léon Šebek.

“It is quite difficult, if not impossible, to reach methane reduction goals that have been pledged without any interventions other than feeding strategies.

“It shows the need for extra interventions.

“What we have shown here is that additional interventions through breeding values and steering microbiome will become available.

“If so, most Dutch dairy farms will have a suitable intervention meaning that we can achieve an average reduction of around 30% in methane by 2050.

“If we only used feed strategies and relied on the efficiency of the herd, we will only get a 15-20% reduction.”

Significantly, these one-off interventions provide permanent gains.

The project team, led by Professor Roel Veerkamp, focused on breeding values in Holsteins, which make up 92% of the 1.6 million-cow Dutch dairy population. 

They measured emissions from 9000 cows on 100 Dutch farms and linked their methane emissions to their DNA, which confirmed heritability of the trait of around 25%.

Correlations with other desired breeding values were found to be maintained.

From this reference population they were able to estimate the first genomic breeding values for methane emissions, which will be rolled out next year.

The project will be extended and international collaboration will enable the reference population to be enlarged to increase the reliability of the breeding values.

This is at least a year ahead of New Zealand, where LIC expects to have a methane-emitting breeding value in the market by 2026.

In parallel to the genetics research, work has been underway since 2017 looking at the whether the natural development of a cow’s rumen microbiome can be manipulated to reduce enteric methane production.

Šebek said initial work established that while feed and feed efficiency are influential factors in emissions, there was still a 20-24% variation between cows when feed was accounted for.

This indicated other factors were in play.

For two years they worked with dairy farmers studying gut microbiome fluid samples, which related back to feeding and management.

From that analysis they established the role of the microbiome.

Šebek said they also established there was no link between the microbiome of a cow and her calf – in other words the environmental factors were dominant over possible genetic transfer.

They introduced to calves microbiome from low enteric methane producing cows and found five doses sufficient to permanently alter the production of methane in the gut of recipient calves.

To prove their encouraging hypothesis, they analysed 60 calves – 20 given microbiome from low methane producing cows, 20 from high producing cows and 20 as a control.

The average methane emissions of the selected microbiome donor groups was 17.2 and 24 grams methane/kg/DM for low and high methane producing cows respectively.

Satisfied the process will provide tangible benefits, Šebek said work is now focused on how to source the targeted microbiome and how and in what format to deliver it.

There is also the issue of securing public support or a social licence given the nature of the product.

Adopting the technology also has to be cost effective and provide sufficient benefits or incentives for farmers.

Programme manager Elian Verscheijden said recent meetings with some of the Netherlands’ most progressive dairy farmers who have used mainly feed and management measurements, showed they were able to achieve methane reductions of 10-15% but could not improve beyond that.

She said this research sends a message to the Netherlands government and the public that the sector is taking the issue seriously and it is making progress. 

Both research initiatives are part of an integrated approach programme launched in 2018 to address methane emissions from livestock farming.

The program is funded by the Netherlands’ Ministry for Agriculture, Fisheries, Food Security and Nature with a budget of least NZ$16 million a year.

Besides research to enteric methane, the programme also includes finding solutions to reduce methane emissions from manure, a significant issue for Dutch farmers.

The first goal of the programme is to comply with the government’s 2030 goal to reduce methane by 30% compared to 2020.

Ultimately the government has a goal of close to carbon neutrality by 2050.

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here. 

In Focus Podcast | Selling lamb to a new generation of Brits

Reporter Neal Wallace checks in from London, where he’s spent time with the Alliance Group’s UK team. They’ve hired a chef to come up with new recipes for those consumers who don’t want the traditional lamb roast and learns that a football stadium is a key part of the strategy.

He has been dubbed the United Kingdom’s favourite farmer, but Gareth Wyn Jones still does a double take at the size of his social media following.

Three Facebook videos of the North Wales farmer working with sheep attracted 710 million, 687 million and 137 million views respectively. He has 2.5 million followers on YouTube, 350,000 on Facebook, 133,600 on Tik Tok and a relatively sedate 67,000 on X (formerly Twitter).

He also fronts television news stories about farming and has made documentaries, including one where he visited Welsh farmers who had moved to New Zealand chasing better opportunities.

It is a powerful tool that the fearlessly outspoken and proud Llanfairfrechan farmer uses to promote his beloved farming sector by highlighting the issues it faces and challenging those he believes unreasonably attack it.

His motives are altruistic but there is an element of self-interest.

“It’s always about telling a story so there is a future for my three children on the land, so they can make a living.”

He is using social media to create an environment for the next generation of UK farmers.,

But it’s a platform that can be a double-edged sword.

A video last spring of him skinning a dead lamb – so he could put the pelt on an orphaned lamb to re-mother it – went viral but resulted in multiple death threats by animal welfare activists.

Police investigated and security was increased at the coastal property.

“It was lunacy. You couldn’t make this up,” Wyn Jones said.

Wyn Jones prefers to engage with critics of farming, to try to reason and provide some understanding and balance, an approach he concedes can at times be a lost cause.

Vegans, animal rights activists and politicians are all fair game, but not for him to  bully and demean, although he concedes vegan animal rights activist Joey Carbstrong riles him to the point where he calls him “little Joey”.

A few years ago Wyn Jones invited a vegan and animal rights activist who was campaigning against shearing sheep onto the farm.

A civilised conversation ensued – all relayed on social media – but even at the end she refused to touch a fleece.

UK media turn to Wyn Jones as the go-to voice of farming on issues affecting the sector.

He has debated decisions by universities not to serve animal protein in their colleges, and the National Trust, which governs the UK’s historic and protected sites, to make half their menus in their cafes and restaurants vegetarian.

Making a case is who Wyn Jones is.

“I have never been a bloke not to walk through a door that is half-open or closed. I always walk through it, I like to look at the challenges, I’m inquisitive.”

He constantly seeks solutions to problems, saying a resolution will never be achieved if people are not honest and refuse to talk to each other.

“If you’re honest, even if you disagree, you are more likely to find solutions to problems,” he says.

And that is where politicians frustrate him. They seldom give a straight answer, he said.

Integrity and honesty are values he rates highly, illustrated by fronting up and conceding to his millions of followers when he got something wrong.

Wyn Jones believes many of the problems facing farmers are the result of supermarkets and government policy severing the link between farmers and consumers and therefore an understanding of how food is produced.

Food that was once available seasonally is now stocked year-round, which removes the mystique and the appreciation of the effort required to produce it.

It becomes just another plum, tomato, strawberry or raspberry, said Wyn Jones. 

“People don’t know what the first strawberry or the first tomato of the season tastes like. They get fed this mass-produced food.”

They also no longer appreciate the value of food, with a third of all food produced globally being wasted.

“It makes no sense, how society has been removed from how food is produced.”

While prepared to confront those who attack food producers, Wyn Jones will praise those who help.

Some years ago he was at a festival attended by the then Prince Charles.

It was obvious to Wyn Jones that the Prince’s minders were wary of the Welsh farmer, perhaps considering him too outspoken and blunt, so kept the future king well away.

Undeterred and definitely not intimidated, Wyn Jones spied an opening and  strode up to the Prince shook his hand and said: “I am not a royalist, but I really appreciate everything you are doing for the countryside.”

Prince Charles was quickly shuffled away by his minders, but the two later had a further conversation.

“The guy was cool,” said Wyn Jones, and deserves praise for what he is doing for farmers, running several properties and promoting British produce.

Wyn Jones has met numerous politicians and said he tells it as he sees it.

Given 15 minutes with former prime minister Rishi Sunak, he gave him both barrels about the sorry plight of farmers. Given a similar opportunity to talk to the Welsh Parliament, he didn’t hold back, lambasting their plans to plant 10% of Wales in trees and allowing 15% to revert to natural habitat.

The net effect, he said, is that 20% of farms will be out of business.

Still to meet new UK Prime Minister Sir Keir Starmer, Wyn Jones has specific concerns about the impact of possible tax changes on farm succession and the management of bovine tuberculosis.

“We have to protect our livelihoods or there will be nothing for the next generation wanting to get onto the land,” he said.

Wyn Jones believes government policy has created an imbalance in favour of sequestering carbon and against the production of affordable food and which totally ignores the role of livestock.

Trees should be planted in the right place and hedgerows nurtured and managed, but he said the contribution of livestock in the carbon cycle should be acknowledged.

He argues that livestock eat vegetation which then sequesters carbon into the soil as it regrows, while also providing nutrient-dense food, employment and underpinning rural communities.

“What I produce is top quality lamb and beef in a sustainable way,” he said.

“This is sheep and cattle country, that is all it can produce. I could not get a combine onto this land, it’s far too steep.”

Farmers were guilty of overgrazing in the 1970s and 1980s, encouraged to do so by government headage payments, but Wyn Jones argues that going by the extent with which livestock numbers have fallen, the opposite could be the case now.

He has debated the future of agriculture at the Oxford Union with journalist and farming critic George Monbiot but says former rock star, Queen guitarist Brian May, an outspoken ally of badgers, will not debate with him the role of badgers in spreading bovine tuberculosis and the impact on farmers.

A UK issue, it has become personal for Wyn Jones, with a close friend forced to sell his farm after his 180 cows were slaughtered due to an outbreak of the disease.

The farm was a disease hot spot, costing him £30,000 ($64,000) a month, and he could not rid of it.

Wyn Jones wants a scientific approach with badgers tested for the disease so those infected can be culled instead of the end recipient.

As badger numbers have exploded, Wyn Jones said, the number of hedgehogs and ground birds on his farm has plummeted, preyed on by the native Mustelidae.

The Wyn Jones family have been on the Llanfairfechan farm for 375 years and he is motivated to ensure his ancestors can be there for another 375 years and more.

It is getting tough.

The average age of farmers in the UK is 67 and getting a start on the land is difficult – and could become even more so if the Labour government fulfils a promise to change inheritance tax rules, which will make succession more costly. 

Where once there were 15,000 sheep grazing the wider Llanfairfechan area, Wyn Jones said there are about 9000 today

Gareth and Rhian are both passionate about the Welsh language and the history of their community.

That includes helping manage a herd of rare Carneddau ponies, of which there are just 220 breeding mares left.

Since Celtic times they have roamed the 11,000 hectare Carneddau mountains, a vast national park that borders the Wyn Jones farm.

Ancient neolithic axe heads discovered in Europe were found to have come from his Llanfairfechan farm up to 6000 years ago.

Wyn Jones has discovered buildings on the Carneddau mountains dating back hundreds if not thousands of years.

His social media role is a seven-day a week business, attracting product endorsements and requiring a support network that includes Rhian, content manager Dewi Jones and two of their three children, Sior and Mari. They have a second son, Rolant.

They are also diversifying.

Their farm hosts weekly immersive tourism for much of the year. That includes working sheep dog displays and giving tourists a hands-on involvement in farm activities.

“It’s culturally not just a farm tour, it’s telling our story and engaging people in everything that we do here,” he said. 

The 240ha home farm is still part of a family company formed by his grandfather, who had five sons.

The company owns 600ha and rents another 200ha split between three blocks, on which they run 4000 sheep, 120 cows, including single suckers, and another 340 cattle.

The predominantly Limousin breed is being shifted to Hereford, which he said suits the country.

They finish stock and grow silage.

Wyn Jones said the farm is a perfect foil for the intensity of his media work, but increasingly his public profile means people with major challenges reach out to him for help and advice.

Mental health is a huge issue among UK farmers and Wyn Jones has dealt with several who have found themselves struggling to cope financially or mentally.

He directs them to services that can assist, but it provides a further reminder of the many challenges facing the sector he loves.

Wyn Jones finds solace in getting out on the farm which he says is defined perfectly in a Welsh proverb: Lle i enaid gael llonydd – a place for the soul to find peace.

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here. 

New Zealand farmers have done the tough part.

Our pasture-based farming system is acknowledged as efficient, having the world’s lowest carbon footprint. Our animal welfare systems are considered world class and we no longer engage in deforestation.

These are some patriotic, baseless claims. This is what global politicians, food processors and retailers say.

But what they acknowledge and what they can quantify are two different factors.

As we say, farmers have done the tough part; they now need to show that data to those who need to know.

Having crossed the first hurdle, our customers want continuous improvement.

The quest for data to prove that sustainability is being acted on is coming from multiple directions: politicians, financiers and companies who have publicly announced carbon-zero targets, non-government organisations who want faster action in climate change, and consumers.

Rules and regulations require regular reporting on meeting sustainability targets but companies are also being judged by pressure groups and their consumers on progress or lack of it.

There are benefits to farmers from meeting these requirements.

That accumulation of information will give farmers greater insight into multiple aspects of their business, but there will also be another significant benefit.

Food companies and retailers today talk about having a partnership with farmers and their processors rather than basic commercial relationship.

They certainly want quality and functionality, but as they meet reporting requirements demanded by governments, boards and consumers they will need buy-in from throughout the supply chain.

They also need confidence and trust that the data being provided is accurate and in a form that is comparable and relevant.

The world is moving fast. We have a ticket to play in the major leagues and we cannot let this slip through our fingers, exposing us to lower-paying, uncertain, price-driven customers.

But we need a process that doesn’t require the filing of duplicated data.

OSPRI, dairy and meat companies, StatsNZ, regional councils and the Ministry for Primary Industries all require data, much of which overlaps.

It must be a priority for those parties to get together and find a way that farmers can collate that relevant data in a way that is useful for all parties.

As we report this week, global agricultural trade is slowing as countries become more nationalistic and protectionist.

There has also been a deluge of rules and regulations imposed by governments such as the European Union, often under the guise of environmental protection but which some say will be at the expense of food security.

One proposal that has earned the wrath of exporters such as NZ is the EU’s deforestation policy, a blanket requirement for producers of products such as beef to prove it did result in deforestation.

Record agricultural subsidies of nearly NZ$1.4 trillion were paid by 54 wealthy and emerging countries each year between 2020 and 2022, but the trend is to start linking payment with environment outcomes.

These two factors are likely to result in lower domestic food production in places like the EU, but the demand for food is not going to slow.

NZ is ideally placed to full that void, but it will require some changes in the way we supply. We will need to quantify just how efficient and sustainable we are at producing food. 

Young Britons don’t eat Sunday lamb roasts like their parents do, and Alliance Group is finding ways to connect to that younger generation.

Those young people do, however, eat koftas, pies and nibbles. They go to pubs, football games, concerts, a percentage enjoy white-tablecloth fine dining and they buy food online.

Alliance Group’s UK and Europe manager Helen Scott said retail remains an extremely important market for lamb, but consumer trends are shifting and exporters like Alliance have to adapt, which it is trying to do by adding value.

“Retail is very important to us as it is to all red meat companies, but we are also looking to create value by targeting food service, hospitality and online sales.”

Alliance has employed Matt Owens as head of culinary, and it is his job to create new products from Alliance’s Pure South, Lumina lamb and Handpicked aged beef ranges and to also work with chefs, hospitality and food service outlets.

This involves finding flavours for pie fillings, burgers and koftas and, potentially, creating new lamb or beef dishes, such as in tortellini pasta, dim sims, pizza topping or lamb and prawns in an Asian broth.

“I’m lucky I know a lot of people who have a lot of ideas and we are close to London City and some of the best restaurants in the world,” said Owens.

Scott said this new product focus and Owens’s culinary skills contributed to Alliance supplying meat and meat products to the New Zealand team and supporters at the Birmingham Commonwealth Games and at NZ House during the recent Paris Olympics.

Alliance lamb and beef products are also supplied to corporate fans at Premier League football side Tottenham Hotspur’s newly owned 62,000-seat Tottenham Hotspur Stadium.

A typical game will see 8000 burgers and 6000 koftas eaten.

Scott said the stadium is also hosting an American Football League match and a concert by Beyoncé at which Alliance products will be sold.

The company that runs hospitality at Tottenham operates a further five stadiums that now serve Alliance products.

Scott said the new range also features on menus, from pubs to high-end hotels in the UK, Europe and the Gulf States, where it is served alongside beverages, room service and at conferences.

Scott said Alliance is also targeting high-end restaurants with its Lumina lamb, which is now on the menus of Michelin star-rated restaurants in the UK and Dubai.

These are small but important steps that Alliance needs to take.

“This is the future for NZ farmers, creating value,” she said.

“We are a sheep, beef and venison red meat co-operative and we’re proud of it, but we are also a culinary food supplier and that is how we are attracting younger consumers.”

Scott said Owens’s extensive contact network from a career work in the culinary industry and as a former chair of the 139-year-old Craft Guild of Chefs, has been crucial in getting a foot in the door of potential clients, but also getting them to try new or existing products.

A commercial kitchen has been built at Alliance’s appropriately named Shepherdess Walk  offices in central London, at which Owens can experiment with products, network with other chefs or brainstorm new ideas, and where the company can host potential customers.

Once a product has been developed it still needs to satisfy commercial and market criteria.

For example, the super yacht industry is a new potential market but will have to satisfy logistic as well as financial criteria.

“We’re very specific – we have to be – and that means we won’t be seen everywhere,” said Scott.

Nearly a third of UK transactions are conducted online and Scott said its Silere lamb range is resonating with young consumers and has an exceptionally high five-star satisfaction rating lodged by customers.

She said consumers relish the story behind Silere lamb, which is told in online marketing.

“It’s the high-spend consumer that is buying Silere. It targets a new consumer.”

The NZ-UK free trade agreement has opened access for NZ beef. Scott said products have been successfully received, in part due to NZ’s existing reputation for lamb but also due to its quality.

The first shipment sold out within a week, she said, with Alliance’s hand-picked, aged product proving especially popular.

Scott acknowledges NZ sheep farmers are having a tough time but has some encouraging words.

“We are very optimistic with lamb and beef here in the UK. Protein consumption is high and it is growing.”

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here. 

A golden era of free trade is over as countries take more nationalistic approach while setting up greater regulatory hurdles, according to a London based trade expert.

David Henig, a director for the United Kingdom Trade Policy Project, European Centre for International Political Economy, said since Chinese economic growth has slowed, no country has come forward to replace it.

India had been seen as an obvious candidate, but Henig said access is complex and the regulatory hurdles high.

“Every country is trying to get in there but the trouble is there are multiple reasons why it is a difficult nut to crack.”

As the growth of international trade has slowed, Henig said, the regulatory requirements imposed by countries have expanded and much of that is being driven by the European Union.

“There is a sense the EU is the dominant regulatory player, it sets the pace and everyone falls in behind it because that is the standard that has to be met.”

Henig has been involved in the EU-United States Trans-Atlantic Trade and Investment partnership and helped formulate UK trade policy following the 2016 Brexit referendum.

He said the “low-hanging fruit” of free trade agreements have mostly been plucked, which coincides with countries becoming more nationalistic.

“The countries that are doing them are at an end but populations are more suspicious as they haven’t necessarily lived up to what they [FTAs] promise.”

Future trade agreements are likely to be small trade deals or deals that cover multiple issues other than trade access.

Few of these deals are being negotiated. 

Politically, announcing free trade agreements is much more popular than announcing the lowering of trade-disrupting regulations, which would be of significant benefit to exporting companies.

The increased volume of regulations around food production is despite little apparent thought about wider implications and how they squeeze out smaller exporters and producers.

Henig said large food-producing companies rather than small players have the scale and ability to meet those regulations while also satisfying retailer requirement for year-round supply.

Food-exporting countries like New Zealand, Henig said, need to stay ahead of the regulatory environment.

“It’s not about quality of product but the way its produced, such as the impact of climate change and adhering to the sustainability agenda.”

He said there is plenty of pressure from groups seeking government regulations on food production to address concerns about sustainability, environment and animal health.

“The net result is that regulations are expanding and we end up with a huge burden to meet.”

The widely questioned EU deforestation policy – a blanket requirement for producers of products such as beef to prove production did not result in deforestation – is an example of policy advocated by interest groups but for which there are significant unintended and wide-ranging consequences.

Henig said this regulatory growth is an untold story but could start to level off due to the complexity it has created.

“They may be able to justify it individually, but cumulatively it makes it virtually impossible for the smaller guys.” 

He would not be surprised if food producers were one day be required to provide consumers with guidance on packaging about the degree of sustainability of the production system, such as traffic lights.

Henig also thinks producers will have to provide verification about claims such as “pasture raised”.

The increasing regulatory process means countries are focused on protecting access to markets for their premier products by ensuring they adhere to those regulations, in the UK’s case exports of Scotch whisky, which are worth NZ$15 billion a year.

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here.

Dairy will continue to play a crucial role for food giant Nestlé, but the company wants to see a reduction in on-farm emissions by 2030.

Florence Henry, Nestlé’s global head of sustainability for nutrition, said given the need for nutritious food to feed a growing population, dairy will continue to play a crucial role, but she wants farmers to continue making progress improving their sustainability.

The market is telling them the future is low-carbon milk.

“We have a big responsibility to feed a growing population,” she told Farmers Weekly.

The three sustainability priorities for all its suppliers are improved productivity, climate and regenerative agriculture.

For farmers, regenerative agriculture means sustainably managing or restoring soil and water and biodiversity quality.

Henry said in a video conference that she accepts New Zealand farmers work with and care for nature, saying that is part of their DNA.

But sustainability makes sound business sense and Nestlé is reflecting what its consumers are telling them and what is increasingly becoming a requirement of government regulators such as the European Union.

“Consumers want to hear stories about where their food comes from, how it is made, how natural it is and how respectful it is of nature, the environment and animal welfare.

“The more you tell the story the more it resonates with and connects to consumers.”

Last month, Speaking via Zoom from Switzerland at the New Zealand Institute of Primary Industry Management conference at Mystery Creek, Nestlé global procurement category lead for dairy Bruno Spire challenged the claim that New Zealand dairy farms have the lowest global carbon footprint.

He said “New Zealand has low emissions but not the lowest.”

Dairy accounts for about 21% of the company’s Scope 3 greenhouse gas emissions and is Nestlé’s largest single source.

Methane is responsible for 40% of total emissions from its dairy operations.

Nestlé wants to see farmers making continuous improvement on sustainability issues and it is prepared to help.

“We’re on the side of farmers,” Henry said.

She said farmers are at the centre of its sustainability efforts as they manage resources and make decisions on practices that suit their individual circumstances.

NZ dairy farmers cannot afford to relax, even though “you are starting from a very strong base if you consider emissions at a farm level”.

She said the NZ dairy industry is well aware of the need to continue improving.

“There is a lot of very positive forces such as DairyNZ and Fonterra co-operative embracing the agenda and really wanting to advance.

“NZ is well positioned but there needs to be continuous improvement.”

According to its 2023 annual report, Nestlé is more than halfway to achieving its 2025 goal of reducing absolute greenhouse gas emissions and well on the way to its 2030 goal of 50% reductions.

About 80% of those reductions are being achieved by changes in the way it sources raw materials, such as investment in deforestation prevention and regenerative agriculture.

Dairy is Nestlé’s single largest raw material, sourced from 200,000 dairy farmers in 27 countries. With such a diverse supply base, Henry said, farmers in different countries have different levers to pull.

Farmers are not on their own, with Nestlé offering incentives to help farmers transition, helping them adjust and investing in research.

Nestlé has its own dairy climate plan but is also part of the Dairy Methane Action Alliance, an international industry body charged with tackling the issue.

Through its action plan, Nestlé is working with Fonterra suppliers on projects such as planting native trees on marginal farmland for carbon capture, reducing on-farm greenhouse emissions through nutrient and fertiliser management, and demonstrating approaches to achieve net zero emissions while retaining farm profitability.

Similarly, it is partnering with Synlait in a seven-year programme.

This includes wastewater management systems, low-carbon emissions feed options, advanced soil testing, alternative fertilisers and tree planting.

The Nestlé Institute of Agricultural Sciences is researching dairy emission reduction techniques including methane-reducing feed supplements, manure management and improved diets.

In 2023 Nestlé developed and implemented a new approach to collect dairy emissions data and measure impacts in markets around the world so it can help suppliers adopt new ways to reduce emissions.

Nestlé has also established a dedicated team to work with its largest dairy derivatives suppliers with work focused on improving diets to reduce dairy emissions.

Nestlé last year had NZ$179 billion in sales, which included milk products and ice cream contributing $21bn, confectionery $15bn, powder and liquid beverages $24.8bn and nutrition and health science $29.4bn.

According to its annual report, Nestlé sells into 188 countries, with more than half its sales in Europe and North America. It employs 270,000 people.

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here.

Subsidies totalling nearly NZ$1.4 trillion were paid to the agricultural sector in 54 wealthy and emerging countries each year between 2020 and 2022.

The OECD’s latest Agricultural Policy Monitoring report says financial subsidies and support for agriculture has reached record levels with restrictions to free trade and production quotas accounting for NZ$667 billion, almost half of all support to the sector.

Martin von Lampe, the head of policy monitoring and evaluation with the Trade and Agriculture Directorate at the OECD, said direct financial support to farmers accounts for on average 9% of their gross revenue, which includes some in countries that have policies that reduce domestic food prices. 

“That means 9% of the receipts received by a farmer across those 54 countries is induced by policies,” Von Lampe said.

Part of the government drive to support the sector is practical – the need to produce food – but it’s also social, the retention of a country’s farming and rural heritage.

He said there is a growing trend for governments such as the European Union to use financial support to drive environmental goals in the agricultural sector.

New Zealand has minimal non-tariff barriers, he said, resulting solely from some sanitary and phytosanitary-related measures preventing imports of table eggs, fresh chicken meat and honey.

The 54-country study included the 38 OECD countries, the five non-OECD European Union member states and 11 emerging economies.

An OECD Food and Agricultural Outlook report notes that 20% of global calories consumed in the world cross at least one border as no country is entirely self-sufficient in producing all the food it consumes.

The study documents a 2.5-fold nominal increase in support compared to 2000-2002, with China accounting for a third of the total support paid in 2020-22.

India was next at 15%, the United States at 14% and the EU at 13%.

Much of the support provided is market distorting, said Von Lampe, resulting in higher prices for consumers.

“We found that a large part of that support is either not helpful or inefficient.”

Some forms of support can also lead to environmental harm but Von Lampe said some governments are decoupling subsidy payments from encouraging food production to a straight area payment.

Some governments are structuring these payments to achieve environmental outcomes such as reducing greenhouse gas emissions, enhancing water and soil quality and enhancing biodiversity and animal welfare standards.

“You look at the new [EU] Common Agricultural Policy and it has a very specific environmentally motivated direction of what farmers must do or not do to be eligible to receive payment.”

He said such payments are still modest in relative terms but are increasing.

Some support directly pays for the provision of environmental benefits not related to agricultural production itself. In Switzerland they represent between 5% and 6% of gross farm receipts

“In aggregate terms across all countries such payments are still relatively modest.”

The report also found the governments in the report have introduced close to 600 climate change adaptation policies,  though implementation, monitoring and assessment of those policies has lagged.

The OECD is undertaking an analysis on how effective these environmental policies are.

The Agricultural Policy Monitoring report says that trade barriers such as import tariffs and quotas slow or limit trade and inflate domestic food prices.

It also calculates that while the increase in support has been less than the sector’s growth, since covid-19 governments have been taking action on trade to limit disruption to supplies of food due to the Ukraine-Russia war.

Productivity growth from innovation has been responsible for historic increases in the volume of food produced and farmer efficiency, but the report notes that despite evidence these investments lead to significant long-term payoffs, they remain a small share of support to the sector.

Of the total support to the sector across the 54 countries, in 2020-22 investments in innovation, biosecurity, infrastructure, and other general services represented only 12.5% of all transfers to the sector.

This is a drop from 16% two decades earlier.

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here.

Food companies and retailers will need closer, more trusting relationships with their suppliers to comply with growing requirements to report their sustainability performance.

Regulators such as the European Union require companies to report progress on reducing greenhouse gas emissions and the environmental impact from within their supply chains, but companies also have their own sustainability targets.

Lee Ann Jackson, the head of the agro-food trade and markets division in the OECD’s Trade and Agriculture Directorate, said many companies have public targets against which customers and consumers can measure their performance.

Complying with those reporting requirements will require more intimate relationships between supplier, processor and retailer than a purely traditional commercial arrangement.

“It feels like more of a partnership is being created rather than a pure commercial relationship,” Jackson said.

That form of information sharing requires trust, regular interaction and an understanding about how data is collated and progress reported against sustainability goals and expectations.

Jackson said this raises the challenge of creating consistent measuring and reporting systems for the various metrics.

This is happening as government support for farmers shifts from producing food at all costs to policies that encourage environmental sustainability and ethical production.

Increasingly food systems and world trade will reflect what she called public-good public policy, policies that incorporate issues such as greenhouse gas emissions, biodiversity, deforestation and animal welfare.

“There are a lot of things related to production that businesses are being asked to or are voluntarily moving in a certain direction.

“They are finding ways in the supply chain to keep an eye on those things the market has not priced in.”

Jackson said food producers have multiple objectives and she believes they can achieve what is being asked of them, but it will require policy makers to co-operate and to stop working in silos.

This is happening, evident by the tone at recent climate change events.

“The priority maybe net zero [carbon emissions] but now the conversation is trying to bring farming in more.”

After 10 to 20 years of sustained growth, trade in agriculture has started to slow.

“It’s still growing but it is slowing down, partly driven by fundamentals such a population growth and where that increase is occurring, but also it could be a policy decision to do with the supply chain and companies seeking trusted trading partners.”

An example of the change is the shift in the language being used in public forums, with reference to resilient supply chains instead of resilient agricultural production, especially since the covid pandemic and the Russian-Ukraine war.

Jackson said the OECD considers private enterprise the best vehicle to manage supply chain risk instead of government intervention.

“We believe the private sector is the best way to manage risk, especially in agriculture and its variables, because that is a big part their game and the private sector is able to hedge bets and establish the relationships needed.” 

New Zealand is a world leader in trade policy.

Prior to working with the OECD, Jackson spent 15 years with the World Trade Organisation and for 10 of those years a New Zealander headed the agricultural trade negotiations.

“NZ has credibility, you think about how trade would work.”

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here.

The European Union’s attempts to improve environmental sustainability could be at the expense of food production, opening opportunities for food exporters such as New Zealand.

Justin Sherrard, Rabobank’s animal protein global strategist, told Farmers Weekly that the EU’s motivation is clear: its politicians are increasingly worried more about the environment more than they are about food production.

“If the EU keeps going down this road, that is good news for NZ farmers  because the EU will have to import more food,” said Sherrard, who is based in Rabobank’s Amsterdam office.

He said there has to be a balance between food production and the impact on the environment, but the needle appears to be shifting.

That environmental focus will reduce the number of farms and reduce domestic agricultural production, with forecasts dairy cow numbers alone could fall up to 15%.

Such a decline will also impact beef supplies, as much of Europe’s domestic beef production is crossbred from dairy cows.

It is likely to be a long game for NZ exporters, with a gradual increase in demand rather than a sudden ramping up.

He questioned whether the NZ-EU free trade agreement has the flexibility and market access that could be needed.

Sherrard said in pursuing its environmental policies, the EU has not built bridges between the factions that have developed, creating a discussion vacuum on the implications of the policies.

“The sensible centre, that is the piece that is missing,” he said.

For example, the EU’s deforestation policy is heavily promoted by non-government organisations and implemented by the director-general for the environment, but lacks input from the EU’s directors-general of agriculture and trade.

The policy is aimed at stopping deforestation of the Amazon and requires producers of certain products to prove their production did not cause deforestation.

An unintended consequence is that it will impact all producers of these products, including beef and its derivatives.

Sherrard said it shows how far policy development has fallen out of balance and how little consideration is given to consumers.

“Governance is about finding the balance.

“I am asking the question if we have the balance right or is it a temporary thing?”

Similarly is the solution to the Netherlands’ livestock manure nutrient issue.

He said the country in the 50 years since World War II became a self-sufficient, highly productive food producer using new, leading technology.

Faced with the nutrient issue, the government’s solution is to cut livestock numbers.

“They’re ignoring history.”

Denmark also risks ignoring its history of innovation by implementing a tax on agricultural greenhouse gas emissions.

“That’s what is missing here, a discussion about using innovation to maintain high levels of production but low carbon emissions.”

That aside, he said the Denmark proposal does include both sticks and carrots for farmers to lower their emissions and Sherrard hopes there will be a significant focus finding innovative and technological solutions.

“I think Denmark may have the balance between sticks and carrots .

“I don’t think you had that balance right in NZ in the first instance.”

He believes the establishment in NZ of the investment group AgriZero will pay huge dividends for NZ, recognising the future role of technology in solving sustainability issues.

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here.

Denmark will start charging farmers for agricultural greenhouse gas emissions from 2030.

A quarter of Denmark’s emissions come from livestock, and the Copenhagen Post reports the government will from 2030 charge Danish landowners a levy based on emissions from livestock, fertiliser, forestry and the disturbance of carbon-rich agricultural soils.

The effective cost to farmers will initially be $30/tonne of CO2-equivalent (CO2e) emitted, rising to $70/tonne of CO2e from 2035.

To soften the initial impact, the Danish government is subsidising 60% of the true cost, with proceeds invested back into the sector to reduce emissions.

It is part of a suite of green packages being introduced by the Danish government that includes planting 250,000 hectares of new forests by 2045 and setting aside 140,000ha of lowlands to protect carbon-rich soils by 2030.

The government will also acquire strategic agricultural lands and distribute or sell them to private and public investments to enhance nature, for the installation of renewable energy or to boost technology and measures to cut emissions.

Amsterdam-based Callum Lott, Fonterra’s manager of trade strategy, sustainability and stakeholder affairs for Europe, Middle East, Africa, said there is much interest in Denmark’s move, but he does not expect a rush of counties replicating what the Danes are doing. 

He told Farmers Weekly that Fonterra initiatives such as Farm Environment Plans have been welcomed by the market and customers.

“What Fonterra has is a credible plan and pathway to how we achieve greenhouse gas emission reductions, and it has been well received, especially the data we have.”

Other initiatives, such as AgriZero, an entity in which Fonterra is a shareholder and which invests in methane and greenhouse gas emission reduction initiatives, are also well received.

Lott said the European Union has introduced several environmental and sustainability policies,  which has obligations on companies.

These include the Green Deal, regulations proving certain food production has not resulted in deforestation, the Corporate Sustainability Reporting directive and the Corporate Sustainability Due Diligence directive.

The Green Deal will restrict the use of fertiliser and chemicals while a carbon border adjustment mechanism taxes imports of high-emitting products based on their carbon footprint so as not to adversely impact domestic industry.

Agricultural products such as meat and dairy are currently excluded.

Lott said the Corporate Sustainability Reporting directive requires companies to report how they are reducing the environmental impact from within their supply chain.

That will mean questions being asked of companies such as Fonterra.

Farmers are not having to confront sustainability issues on their own.

James McVitty, Fonterra’s Chicago-based manager of trade strategy, sustainability and stakeholder affairs for the Americas, said sustainability issues transcend every level of the food industry.

In response producers, processors and retailers are working together through several industry and sector groups and bodies to find solutions.

The Sustainable Agricultural Initiative (SAI) has for 20 years promoted growing a sustainable, healthy and resilient agricultural sector while creating strong and secure supply chains.

Its 190 members are a who’s who of global dairy processors and buyers, including Danone, Mars, Nestlé, McDonald’s, Starbucks, Hershey, Synlait, Arla, FrieslandCampina, Dairy Farmers of America, Land O’Lakes, Kerry, Glanbia, Leprino and Fonterra.

McVitty said taking an industry-wide approach to these issues ensures consistent messaging for customers, public and government.

“We are trying to present our sustainability metrics on a consistent basis to buyers who want to see continuous improvement across a broad range of sustainability topics and the Sustainable Dairy Partnership grouping promotes an aligned approach.”

The global industry-focus Sustainable Dairy Partnership provides a sector focus on sustainable management systems, progress and impacts on issues particular to dairy.

Bodies such as the Global Dairy Platform, which is chaired by Fonterra chief executive Miles Hurrell, gives dairy a presence at international sustainability forums such as the United Nations Climate Change Conference and this month’s New York Climate Week conference.

The direction is clear, said McVitty.

“There is increasing customer demand for products supported by emissions and sustainability data credentials in business-to-business relationships.

“Customers are increasingly looking to suppliers to help them meet emission-reduction targets and NZ’s pasture-based farming model is a competitive advantage, but the offshore competition is catching up.”

NZ dairy farmers are fortunate to have vast farm-level data to assist with compliance.

“Farm-level data is a huge advantage for NZ.”

The International Dairy Federation is another global platform promoting sustainable dairy practices, and McVitty pointed out that NZ will host its annual summit in 2026.

More: Wallace is visiting seven countries in six weeks to report on market sentiment, a trip made possible with grants from Fonterra, Silver Fern Farms, Alliance, Beef + Lamb NZ, NZ Meat Industry Association and Rabobank.  Read more about his findings here.