Race on to reduce emissions from New Zealand livestock

Published: April 30, 2024

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News article - Business Desk, April, 2024.

Shared from Business Desk - for the full article click HERE.

 

Race on to reduce emissions from New Zealand livestock

It's unknown by how much methane emissions from livestock could be reduced.

Last week, the government joint venture AgriZeroNZ announced it was investing $5 million from a now $183m war chest into BioLumic, part of a multi-pronged effort to reduce cattle and sheep farming emissions.

A technology fix is shaping up to be New Zealand’s best hope of reducing farm emissions, keeping customers and trading partners happy while avoiding a major fall in production.

When the government this month announced an independent review of NZ’s methane emissions targets, associate agriculture minister Mark Patterson said an investment in innovative technology was the key to putting farmers at the forefront of global methane mitigation efforts.

At the forefront of those efforts are two organisations that work closely together.

The NZ Agricultural Greenhouse Gas Research Centre (NZAGRC) was established in 2009 to fund and direct basic research and development. 

The much newer AgriZeroNZ was set up last year to act largely as a venture capital organisation to commercialise new ideas in NZ and overseas.

AgriZeroNZ chief executive Wayne McNee is a former CEO of LIC (Livestock Improvement Corporation and a former director general of the Ministry for Primary Industries/MPI).

He said most international research into reducing farm-based emissions was for high-intensity and indoor-based systems.

AgriZeroNZ was created because NZ’s farming was pastoral based, and research in that area had been lacking. 

 

The vaccine holy grail

So far, AgriZeroNZ has invested more than $22m into ventures, such as $4.1m into US startup Hoofprint Biome last year. It has taken a $1.8m stake in Waikato-based Ruminant Biotech, which works on a slow-release and long-lasting bolus to inhibit methane. 

BioLumic, founded in Palmerston North and now with operations in NZ and the US, will use its UV seed treatment technology on ryegrass. If it can increase the fat content in ryegrass by 2-3%, it should be able to reduce ruminant methane by more than 12%.

McNee said another very big announcement was in the pipeline.

AgriZeroNZ is 50% crown-owned and 50% owned by nine companies, co-operatives and banks.

This month, the a2 Milk Company, ANZ and ASB joined existing shareholders ANZCO Foods, Fonterra, Rabobank NZ, Ravensdown, Silver Fern Farms and Synlait Milk. 

They brought in an extra $9m, which the government matched. 

A vaccine to reduce ruminant emissions is something of a holy grail in research, and it's something NZAGC has been involved with for many years, with most of the research done by AgResearch.

This month McClay announced that AgriZeroNZ was investing $1m to set up a new stand-alone vaccine venture, on top of $1.5m it has already put into the existing methane vaccine programme.

It's hoped that the venture will attract international funding.

 

A race against market forces

The stakes are high. According to the Ministry for the Environment's latest greenhouse gas emissions inventory, sheep and cattle contributed 48.6% of NZ's total emissions in 2022, of which 25.7% was from dairy cattle, 12.4% from sheep and 10.5% from beef cattle.

NZ has set a domestic target to reduce its biogenic methane emissions by 10% below 2017 levels by 2030 and by between 24% to 47% by 2050. 

Agriculture minister Todd McClay recently acknowledged that NZ's trade partners and others expected the agriculture sector to contribute to NZ's climate change obligations. 

Last November, Fonterra announced a scope 3 emissions reduction target of 30% by 2030 from a 2018 baseline, a move publicly welcomed by major customer Nestlé.

More than 80% of the co-op’s emissions come from farms.

UK supermarket giant Tesco Group has a science-based target to reduce scope 3 emissions from forests, land and agriculture by 39% by 2032 from a 2019 baseline year.

McNee said there were trade risks, particularly in the European Union, which was very concerned about the emissions profile in products. 

“There’s a big drive from a number of international customers, McDonald’s, Sainsbury’s, Tesco, Nestle, Danone, Mars, you name it, they all have scope 3 emissions, and they all want lower emissions in their product,” McNee said. That makes NZ’s efforts to reduce agricultural emissions partly a race against market forces. 

“We don’t want to give them any reasons to put in place any barriers to our products,” he said.

 

A scattergun approach

So, what causes cattle and sheep to emit methane and what can be done about it?

McNee said the rumen was an anaerobic digestive system with various microbes that process grass and other plants. 

“Among those are things called methanogens, which don't seem to serve any useful purpose other than taking energy away from the animal and making methane.” 

All of the tools being tried were trying to reduce the number of methanogens or reduce their efficacy without affecting the health of the animal or productivity.

NZAGRC executive director Naomi Parker said the strategy of the two organisations was to find a range of solutions: silver buckshot rather than a single silver bullet. “It's going to be a combination of practices by farmers, some new technology, and thinking about how all of that fits within a system.”

NZAGRC had started as a fairly small outfit with around four people and a budget of just under $5m a year. 

“We're now more on the scale of 20 million per annum. Our funding primarily comes from MPI, but also, over the years, we've had funding from industry.” 

NZAGRC had funded work alongside LIC and cattle breeding company CRV NZ into breeding low methane dairy cows, which looked promising, and it wanted to look into beef cattle breeding as well.

To put one or more promising emissions solutions into a system leads to “stackability” considerations, as Parker called it. 

“What emissions reduction might you really get from a vaccine plus an inhibitor, plus some on-farm optimisation?” 

Parker said Ireland’s agricultural sector was probably the most similar to NZ’s among industrialised countries. 

On the other hand, many less developed countries, particularly in Africa, also relied on pasture-based farming, which attracted interest from big philanthropic organisations such as the Gates Foundation.

Parker said the two organisations were focused on meeting the current emissions targets and were working on improved modelling to understand progress better.

“You can do lots of back-of-the-envelope estimates.

We want to understand really clearly, for every single thing we're looking at across the portfolio, based on our current understanding, how far will that take us?

“We're probably more focused on thinking about where we would need to be by 2040 to hit our 2050 targets because we're in that longer-term R&D space.”

 

What the farmers think

What is the view from the farmgate about the work being done? McNee said the view was mixed. 

“There are a number of farmers, particularly sheep and beef farmers, who would say, 'We don't think methane is really a problem'. Therefore, who cares about what you are doing?” 

McNee had also talked to Groundswell several times, an organisation that has campaigned hard against government policies on agricultural emissions.

“The majority though, they're part of the companies that have invested in us, the co-ops.

They're also got their bank saying, 'well we'll give you a green loan if you show us you can improve your environmental performance',” that's also a driver,” McNee said.

Keeping our edge with NZ competing against such overseas barn-based farming and with pressure from multinational customers, will AgriZeroNZ’s and NZAGC’s work be enough for NZ to keep its edge and its markets?

“Let’s see how far we can go,” said McNee.

“There’s some theory that the tools could reduce emissions completely, although as you increase the emissions reduction, you do have to watch the safety of the animal and the animal’s welfare.”

Parker said NZ had a good chance. 

“We’ve been ahead of the game; we’ve been looking at this hard for a long time. But it is hard. It’s complex science.”

Although there has been some growth in indoor farming in NZ, neither Parker nor McNee see the grass-based model changing here.

“There’s a lot of customers around the world who like the idea of the fact that animals are outside eating grass, not closed up in a barn with a [methane] digester stuck on the side of it,” McNee said.

Published: April 30, 2024