These are the sorts of questions we should be asking ourselves as, after an almost endless game of political football, Australia finally puts a price on pollution. We need the whole carbon price discussion to be seen as a risk management exercise. This is not a moral question. As farmers we need to recognise that it is in our self-interest to move to a low carbon world.

Now that there is a scheme to cut pollution in heavy industries, the portion of Australia’s emissions coming from agriculture will grow and pressure on farmers to reduce their emissions will mount. 

Compared to other industries, farmers have a period of grace, free of any direct liability for their emissions. At the same time, the Carbon Farming Initiative (CFI) will give producers the choice to take part in the emerging carbon market. Linked to a carbon price, the CFI will potentially see hundreds of companies buying climate change solutions from agriculture. 

Don’t expect farmers to leap at the chance to be involved.  It will take time to develop new technologies, management practices and confidence in handling an entirely new commodity – carbon. 

Practically, many farmers won’t be interested until the carbon price becomes truly competitive. Realistic estimates suggest farming and forestry could offset a modest 3% of Australia’s total emissions by 2020. This represents around 10% of the sector’s own emissions – a pollution reduction of up to 15 million tonnes in 2020. 

Those millions of tonnes represent new investment that will help farmers, including dairy farmers, manage future risks and ensure they are recognised for doing their fair share. 

And those who make a serious effort to explore the opportunities are more likely to be in a position of strength as the world shifts into low-carbon gear. 

And shifting it is. Europe, Japan, Korea, New Zealand, some American states and China all have targets for cutting or, at least, limiting pollution.  On the Government’s conditions China’s target would be equivalent to a 25% cut in Australia’s 2000 emissions by 2020. 

Around the world, the low carbon revolution is underway. Unless farmers are a part of it, we will be left behind. Carbon sense will make economic sense.

Australian agriculture boasts a strong tradition of ingenuity. Farmers’ capacity to innovate and adopt new technologies should not be underestimated. 

A failure to put a price on carbon pollution would hold Australian agriculture back when we urgently need to unlock investment in cleaner energy, production and fuels 

As a matter of priority, pollution pricing revenue should be used to help farmers, suppliers and processors adjust; to invest in research, development and extension. Thanks to community and industry lobbying, the federal government has committed revenue generated by the carbon price scheme for this purpose. 

Dairy will face extra annual costs, especially given its heavy reliance on fossil-fuelled electricity. Dairy is obviously a trade-exposed sector that has had to grapple with variable prices and is still on the mend after the country’s hottest drought on record, not to mention the downpour and pest plagues that followed. 

But the history of dairying in Australia is one of long-term growth, and international demand is surging. According to Dairy Australia, exports in the first half of 2011 were up nearly one-fifth from the previous year, despite a weakened global economy. 

Australian dairy farmers have such a strong comparative advantage that the industry’s future is hardly at risk, least of all from a carbon price. In fact, for producers and consumers alike, any impact of the scheme would almost certainly be dwarfed by the costs of more hostile weather linked to changes in our climate. 

Furthermore, even with a price on pollution, dairy farm cash incomes will continue to grow strongly into the long term, according to economic modelling by the Australian Farm Institute. 

A key element of Australian dairy’s strong competitiveness is its world-class quality management, from paddock to plate.  The task now, for all farmers, is to make sure our competitiveness is shored up by high-quality environmental performance. 

I agree with Fonterra, carbon pricing is a chance to lift dairy producers’ and processors’ energy efficiency, cut unnecessary costs and maintain competitiveness.

This isn’t to gild the lily—a carbon price does pose a challenge for some producers, but there are far bigger risks to the whole industry: lingering uncertainty and political flip-flopping that would hold up investment, not to mention the risk that our natural advantage will be eroded if climate change is left unchecked. 

It’s critical that farmers are given the option of tapping into the carbon market, given a leg up, and given the opportunity to show they can come up with the tools and techniques to cut emissions without cutting productivity. 

Mark Wootton is Principal and Manager of Jigsaw Farms and Chair of The Climate Institute.

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