Country Wide Magazine, May 2022

The company behind multi-national furniture and home accessories brand IKEA claims its purchase of a large Southland farm is for production forestry, not carbon farming, Annabelle Latz reports. An international company which recently bought Wisp Hill Station in Southland claims its objective is, first and foremost, to create a production forest, not to mine carbon. This is despite the fact the company is in the process of registering with the Emissions Trading Scheme (ETS). The 5500ha sheep and beef farm is the first land bought in New Zealand for Ingka Investments, the investment arm of the group and its retail business IKEA.

The purchase agreement became unconditional with the approval of land acquisition by the Overseas Investment Office on Friday, August 27, last year, bought from the Ward family. A lease- back requirement will allow the family to properly phase out their operations over a minimum three-year period. Country-Wide was refused a verbal interview with Ingka Investments, and received written statements instead.

Ingka’s forestland investments portfolio manager of Andriy Hrytsyuk said the plan is to grow a productive forest within an afforestation project which expands its global forestry portfolio and demonstrates its commitment to responsible forest management, with a focus on timber sales to generate a return on investment.

This recent conversation with Ingka Investments was the result of the cover story in Country-Wide’s March issue, Carbon Mining Exposed which stated the neighbouring 1250ha of Southland farm of Logan Evans called Koneburn had been bought by an international company for carbon mining, some 80km from Wisp Hill Station. Country-Wide did not mention the name of the buyer. Ingka Investments contacted Country- Wide directly, specifically referencing Wisp Hill Station but not the farm mentioned in the article.

Two farms bought

Country-Wide understands Ingka Investments has bought at least two farms in Southland on which they plan to plant both pine and native trees, one of them being Koneburn, the ownership being transferred to them on June 30, 2022.

Writing specifically about Wisp Hill Station, Hrytsyuk claimed it will not be a carbon farm, and stated carbon credits will not be part of the calculus. “They are not sold, nor we do not engage in internal carbon offsetting to reduce our carbon footprint.”

In a media release last September, Ingka Investments stated it will be planting 330ha in radiata pine seedlings, with a long term plan to have a total of 3000ha and more than three million seedlings, planted in the next five years. At the same time the plan is to naturally regenerate the remaining 2200ha into native bush. The new forestry investment in NZ will see its forest planned harvest take place at the end of the first rotation, 29 years after planting.

“Our plans include serious investment into native species enhancement, and all the main riparian areas are earmarked to be planted in native species including manuka. A significant gorse and weed control programme has already been implemented on these riparian areas, something that has lacked any investment for over 50 years on the property.”

Hrytsyuk told Country-Wide in March that Ingka Investment’s afforestation business

is a long-term investment which focuses on the cycle of planting seedlings on unforested land that will eventually become mature trees for harvest.

“We have begun the process of registering the property with ETS because it was the logical, prudent step to take as newcomers to the New Zealand market, but again we have no intention of selling carbon credits,” he said, adding that they will calculate and report the amount of carbon removed and stored in the trees, both in NZ and other countries.

It is Ingka Investments’ plan to draw on labour units to develop and eventually harvest the trees, and invest in native species enhancement. Hrytsyuk said the property will require years of labour inputs including preparing the soil, planting the seedlings, pest and weed control, thinnings and more, before harvest can happen.

Hrytsyuk acknowledged NZ’s proud tradition of agriculture, and the importance of its role in the economy, but added “forestry also has a role to play”.

“Our approach to responsibly manage forestry provides jobs and economic growth on the same land while also making a positive impact on the climate through carbon sequestration and biodiversity.”

All wood harvested in their forests is sold on the open market and does not comprise a significant part of the IKEA supply chain, (as a home furnishings retailer).

Logan Evans, a Groundswell member, expressed disappointment in the Government allowing the sale of farms like this to overseas investors.

“The Government has talked about stopping this happening, but when? Policies which suit their agenda get pushed through fast, so why is this taking so long?”

He agreed planting natives is better than mono- culture planting, but it is still way off the mark for attempting to mitigate global warming. Especially when it involves an overseas company whose sole business model is to plant pine trees and claim credits, despite their reasons for registering with the ETS.

Evans said to attempt the stopping of global warming, first the crippling of NZ agriculture needs to stop. The world needs to look at NZ farmers as the prototype of how to farm efficiently and with the environment.

“Collectively everyone must focus on reducing gross emissions rather than off-setting them. We need a global plan to achieve this.”

Evans said if he dotted on a map all the farms around him and NZ where pine trees are being planted for carbon farming (or ‘carbon mining’ as he calls it), it would be huge.

“It’s the silent assassin sneaking through our rural communities.”

See the article online here

Country Wide Magazine, March 2022.

Apparently, a few decades ago you’d need your temperature taken if you were thinking of farming Merinos in the North Canterbury high country. With an annual rainfall of 1100mm and clay-based soil, out the back of Culverden neighbouring farmers the Reeds and the McRaes knew not everything was in their favour, but it was a challenge they were willing to accept, and they don’t regret it. Graham Reed and Beau McRae have been great mates for nearly 50 years. Graham and his wife Anne moved to The Grampians from Sheffield in 1973 when Beau and his wife Georgy were on Glens of Tekoa just down the road. In the mid 1970s Beau’s flock was all halfbreds with no wethers, but relying on the market of selling store lambs was no longer quite cutting it for the account books. Knowing he needed a change in direction, Beau chose to focus on a bigger type of Merino which he could cross with a halfbred, riding the wave of the juggle between retaining vigour and producing a stable type of sheep. Graham followed suit a few years later, departing from his 15-year tenure of Corriedale breeding at The Grampians, due to the frustration with the wool market and the price of meat.

“I figured I could grow better wool on Merinos and get better prices,” he says.

Graham and Beau both ran split flocks for a while, keeping their foot in the door of the lamb prices that did pick up again. “Crossbreeding did pay the bills, but so did the wethers,” Beau says. They both ran substantial stock numbers, which varied in ratios of halfbreds and Merinos over the years, eventually both choosing Merino flocks once the footrot problem dissipated. “Numbers varied year to year, especially with hogget numbers,” Graham says. Australia was making the wool price picture look good at the time, guaranteeing $7/kilogram, then $8/kilogram.

Market flooded

Beau recalled Australia flooded the market at such smart prices, so prices then fell by half in the 1990s. “But even at $7/kg, it was still better than what we were getting for the halfbreds.” Back in the 1980s, land development subsidies, stock incentive schemes and suspension loans all created a colourful picture for New Zealand farmers. Through the 1990s the fine wool struggled at about $7/kg. The NZ Wool Board threw farmers a lifeline by setting the minimum price. The wool began to stockpile in NZ and even more so in Australia, the demand for high end clothing such as Italian suits not quite being at the rate some had predicted.

Farmers started to chase the mid micron range, and even up to 19m which was deemed the best option for sports clothing because it was durable and comfortable. “It was all about the prickle factor, and the quality of the wool,” Graham says. Another factor taken into account when producing Merinos in less traditional Merino country, was the necessity to run more cattle. But they made a great job of cleaning up the native land, Merinos following and finishing off the job. Both farmers ran between 40-50% cattle stock units.

The flipside was that the higher the ratio of cattle, the less parasites in the sheep. In the earlier days, all the sheep would go on the native blocks in the autumn, and they’d lamb at about 85%. This method was tweaked in later years, whereby just the wethers would go out on the native land and the ewes would stay on higher-quality pasture.

Footrot strikes

Top dressing was a good solution to increase feed, because quality wool was all about that, but “then came the footrot”. “We were spending a lot of time tipping over sheep,” Graham says. It worsened in the 1990s with severe cases where sheep would find it difficult to move around and eat, creating breaks in the wool. “The average condition score would be well down, there was no doubt about that.” Beau was also battling with carpal tunnel syndrome in his hands from the constant foot trimming, so some tough decisions were being considered and there were thoughts about whether to carry on with Merinos or not. But then there was a turning point.

Near the end of the decade came the development of the footrot gene-marker test, thanks to Professor Jon Hickford from Lincoln University. Early days of the test involved blood testing Merino rams around the South Island, to see if there was a genetic link to footrot. Beau and Graham were both an instrumental part of this research, having been involved in the local branch of Federated Farmers and knowing about access to the Ministry of Agriculture’s Sustainable Farming Fund. So they applied for $300,000 to utilise this technology and arrange for stud rams around the South Island to be blood tested, given fellow farmers would get on board.

“It was about promoting this genetic technology, we worked out that the best approach was to give the money to stud breeders to test their own rams,” Beau says. A dozen studs around the South Island took part, the goal to find out what key sires did or did not have strong genetic links to footrot resistance. It was revealed that one particular MHC (major histocompatibility complex) gene called DQA2 was associated with sheep having a greater or lesser likelihood of developing footrot. This research became the basis of a gene-marker test that enabled sheep breeders to identify sheep that were considered less likely to develop this debilitating condition.

Footrot resistance

Beau says the main thing they learned was there was a genetic factor involved in footrot, it was quite heritable, and they could breed sheep that were resistant to it. “We’d start culling and stop treating, because beforehand we’d basically been breeding it.” Rams were ranked on a score of one to five, depending on the level of alleles, a gene variant (one of a pair of genes that appeared on a particular chromosome if the DQA2 gene was prevalent). Therefore, the idea was to have two ones which meant they were reasonably resistant. Beau admits it really hurt to cull an $800 ram or ewe with quality fleece because it had footrot. “That was a real lightbulb for me, we never knew there was a real genetic influence at all,” Graham says, adding that once they changed their method from treatment to culling and stopped vaccinating straight away, everything changed. It took about five years to see a difference, but it was a game changer in Merino farming and once they stopped tipping sheep all the time, they wondered how they ever did it. Into the 21st century, and Graham says farming Merinos began to paint a different picture.

“Footrot was no longer an issue for us, we didn’t need to trough or anything.”

In the early 2000s wool prices were at the lowest they’d been, while cattle prices were good and the fat lamb market wasn’t looking too bad either. Thus began a shift in focus to breeding a dual purpose sheep, pushing carcaseweight and good constitution while retaining the quality of the fine wool. Breeding for internal parasite resistance also became a reality. Producing an animal they are proud of is what Graham and Beau find most exciting about the Merino industry, where they can offer a product in high demand around the world. “It’s pretty satisfying to have a better clip, and if you get more weight too then that’s the deciding thing,” Beau says.

See the article online here