Caroline Saunders, the president of the Agricultural Economics Society writes in its latest newsletter: 'Climate change is impacting on agriculture, both through consequences such as extreme weather events and through major changes in policy.'
'New Zealand [where she is a professor] is in an unusual position with 48 per cent of its greenhouse gases coming from agriculture. The New Zealand government has passed a Zero Carbon Bill with zero emissions by 2050. The agricultural sector has until 2022 to show how it will achieve this; otherwise, it will go into the Emissions Trading Scheme in 2025. In the UK, agricultural emissions are about 10 per cent of the total, but the UK also has the ambition of net zero emissions by 2050.
Both countries must work out how to measure the emissions, the point of obligation, the treatment of methane and the methods available to farmers to reduce emissions, and how to support farmers through the transition. There is also the issue of trade and the potential substitution of imports produced with higher emissions (New Zealand has relatively low carbon emission per unit of output).
New Zealand and the UK have strong links and it will be interesting to see how negotiations between the countries address these issues. Given WTO rules, this may be through a new trade agreement and/or through promoting consumer preferences for products with low carbon footprints. New Zealand was the first country to adopt a formal well-being budget in 2019.
Whilst it is early days to see how this will transform policy, it is a step in the right direction. One consequence is a shift in policy thinking to put more weight on the well being of those in the agricultural sector, given the changes mentioned above. A key challenge for the [agricultural economics] profession is to research the distinctive role of government to ensure transitions that consider farmer wellbeing.'
One interesting consideration is how Brexit will affect any future trade agreement which is likely to be sought by the UK. One issue could well be trade offs between financial services (for the UK) and agriculture (for New Zealand).