11. Question No. 11—AgricultureMARK CAMERON (ACT) to the Minister of AgricultureQuestion No. 11—Agriculture11. MARK CAMERON (ACT) to the Minister of Agriculture: What advice if any has he requested from his officials regarding the Global Dairy Trade Auction Price Index falling by 7.4 percent overnight and what impact does he expect this fall will have on New Zealand's wider economy?Hon DAMIEN O'CONNOR (Minister of Agriculture): To the first part of the member's question yes I have requested advice from the Ministry for Primary Industries about the change in the Global Dairy Trade Price Index. To the second part of the question I will quote for a start ANZ rural economist Susan Kilsby who said this morning We've seen these cycles before and everyone does get through them". This will have a big impact on our economy and this Government commits to work with the dairy industry to ensure that market opportunities are opened up and that we assist them with the vital infrastructure that they and their farmers need.Mark Cameron: Is it still his Government's policy to price agricultural emissions a policy which could decrease net revenue for dairy farmers by 6 to 7 percent despite the fall in the Global Dairy Trade Price Index?Hon DAMIEN O'CONNOR: This Government's been working with all the agricultural sectors for about five years. We've made good progress in the recent week or two. We are committed to include agricultural pricing in our international emissions reduction programme. I'll remind him and the National Party that it was in 1997 that former Minister Simon Upton committed New Zealand's agricultural emissions—Christopher Luxon: You're making it up.Hon DAMIEN O'CONNOR: —to our international obligations to reduce them.SPEAKER: Order! Christopher Luxon will stand withdraw and apologise.Christopher Luxon: I withdraw and apologise.Hon DAMIEN O'CONNOR: Mr Speaker thank you very much. I'm a little bit deaf particularly to comments like that. Can I say that it is irresponsible for any agricultural leaders to ignore the market realities that are coming at us. Can I quote "Fonterra's biggest customer is Nestle. Nestle has a commitment to reduce its Scope 1 2 and 3 emissions by 50 percent by 2030." If we don't participate in that emissions reduction programme and give honest signals to farmers we are misleading them and they will be locked out of markets.Hon Gerry Brownlee: See if you can respond in a ministerial statement.SPEAKER: Order! That's completely out of order. Come on.Mark Cameron: Has he asked his colleagues to put a hold on essential freshwater regulations which increase cost for dairy farmers via expensive resource consenting and freshwater farm plans given dairy farmers are facing record high production costs and falling dairy prices?Hon DAMIEN O'CONNOR: I'm acutely aware of the dilemmas that the dairy farmers are facing at the moment. There is a whole range of different dairy farming operations some that will be paying $4 to $5 per kilogram of milk solids to produce their milk and others that will be requiring over $8. Resilience is the trendy word of the day. What we are saying to the sectors is that we must be prepared for the cycles that inevitably go down. We have been seeing record returns and prices for dairy and other primary sector income. This year a record $56 billion in gross export earnings have come into this country a lot of it from dairy. If you have prices so high in commodity markets the only way for them to go usually is down and it is important that we warn farmers including the increasing requirements on market access. And if that member thinks we can continue to have degradation of our water degradation of our biodiversity and outrageous animal welfare practice and still get into our high-value markets he's misleading the dairy industry that he proposes to represent.Mark Cameron: Will he ask James Shaw to dump significant natural areas a policy that will mean farmers lose even more productive land to Government red tape?Hon DAMIEN O'CONNOR: Since 1992 when the National Government passed the Resource Management Act significant natural areas have been a legal obligation for councils to identify. The fact that many of them have not and that now there is a requirement to do so is simply part of the reality that if we are to market into places like the European Union they require us to be responsible managers of biodiversity of our natural features and attributes. It's the reality that we face as the producer of the finest food and fibre in the world trying to sell to the world's most discerning markets. We have put hundreds of millions of dollars of taxpayer money to assist the farmers through this journey. We'll continue to do that. If he thinks that's not necessary he's misleading himself and the farmers."