But I believe there is something scarier out there. Something that makes the ETS look like a puppy dog.
That is synthetic protein. Synthetic milk and meat, in particular, scare the bejeebers out of me.
So why are synthetics so scary?
Well, they can compete on a level that we and our traditional competitors such as the US, Europe or Australia can’t. In some cases, the production of synthetic meat or dairy create carbon emissions of only 10% of that of traditional methods.
Moreover, start-up companies in this sector have attracted some serious investment. For example, Impossible Foods, an alternative meat producer, has raised over US$400 million from cashed-up investors such as Bill Gates.
Considering that fact, it’s no wonder Sir Peter Gluckman, formerly the Prime Minister's Chief Scientific Advisor, last year said ‘when it came to milk and plant-based artificial mince, concerns around taste, the scalability of manufacture, regulatory issues and consumer acceptance had either already been addressed, soon would be, or were minor.’
And that is one of the factors that has the potential to lead sustainability-minded global consumers to try synthetics, creating the possibility that they switch from traditional sources of protein like milk, beef and lamb. So, while New Zealand and our traditional competitors contemplate ways to mitigate our carbon emissions, synthetic producers are positioning themselves to be to agriculture what solar and wind are to coal.
But it’s not too late to act. Keeping our place at the protein table will require NZ farmers to adopt best in class environmental and animal husbandry standards, and not just when the regulator is looking. By the way, we also need to start thinking how we can co-exist with alternative proteins as players in the wider global protein market.
With this in mind, we can start to show those consumers that we hear their questions around how is NZ agriculture playing its part in the fight against climate change. Or, maybe, it’s more a matter of agriculture around the world telling its sustainability story better. Either way, the ETS may provide traditional NZ agriculture producers with a rally cry that these consumers can hear.
From such a platform, traditional producers have the opportunity to refocus consumers’ attention on other parts of traditional agriculture’s story. By that I mean, the connection to the land and the natural environment, farming families’ stories and their traditions amongst other things.
Moreover, that is where synthetic producers are weak – they have no farming traditions or affinity to the land and animals! After all, who wants to eat a steak produced by someone in a lab coat when you can eat one produced by a passionate local farming family with a spiritual connection to their land?
Nathan Penny joined ASB as its Rural Economist in 2013, having previously worked at Westpac and the New Zealand Treasury.
Nathan hails from the Kapiti Coast and made the short trip up the road to study at Massey University where he graduated with a Master of Applied Economics. Nathan also lived and worked in Japan and he is a fluent Japanese speaker.
His expertise lies in dairy and other commodity markets, trade economics and economic forecasting. He authors ASB’s monthly rural publication, Farmshed Economics. He’s also a leading GlobalDairyTrade auction and milk futures commentator, and is consistently the most-quoted bank rural economist in all forms of media.