Government’s methane review panel begins critical work on agricultural emissions, Synlait faces fresh uncertainty as it withdraws 2024 earnings guidance, and Zespri trials expert crowned 2024 Bay of Plenty Young Grower. Welcome to Proud Country's Early Bird - The top things you need to know that impact rural New Zealand delivered to you by 5am, because who doesn’t need better chat beyond the weather! Government’s methane review panel begins critical work on agricultural emissions The secretariat of the Government's new methane science review panel has emphasised the importance of agricultural industry support in developing long-term solutions for agricultural emissions. Chaired by Nicola Shadbolt, a farmer, academic, and former Fonterra director, the panel has begun its work, which Shadbolt describes as "critical and long overdue." The secretariat acknowledges concerns within the farming sector about the fairness and appropriateness of the current 2050 methane target, set in 2019. These concerns include potential higher production costs and the risk of production moving offshore. The panel will review the latest methane science to provide an independent, up-to-date evidence base about methane's warming impact. This work will complement the Climate Change Commission's review of 2030 targets and inform the Government's response to the Commission's advice. Agriculture Minister Todd McClay states that the Government is committed to meeting climate change obligations without compromising New Zealand farms. He emphasises the need for fair and sustainable targets, noting that New Zealand farmers are among the world's most carbon-efficient food producers. The five-member advisory panel includes experts from various universities and research institutions, bringing extensive domestic and international experience on climate change and biogenic methane. Current legislated methane targets require a 10% reduction by 2030 and a 24 to 47% reduction by 2050, targets that have been opposed by farmer groups like Federated Farmers since their inception. And the CountryWide Podcast looks deeper into this issue. Episode 28: How to make or break our future with emissions, find it where you get your podcasts. Synlait faces fresh uncertainty as it withdraws 2024 earnings guidance Canterbury-based Synlait is grappling with new challenges, just days after shareholders approved a crucial loan to keep the company afloat. The company has now withdrawn its earnings guidance for the 2024 financial year, citing unexpected complications. Synlait attributes this decision to unforeseen timing differences between July and August for manufacturing and shipping, which have impacted its 2024 performance. Additionally, the company is facing higher costs related to its ongoing strategic review and deleveraging plan, due to extended timelines for these processes. As a result, Synlait now expects its final underlying earnings to fall below the previously announced guidance, which was already at the lower end of a $45 million to $60 million range. This earlier guidance had excluded a non-cash adjustment of $17 million. This development comes on the heels of a significant shareholder vote last week, where approval was granted for a $130 million loan from major shareholder Bright Dairy. This loan was critical in meeting a deadline to repay Synlait's debt, averting the possibility of voluntary administration. Despite these setbacks, Synlait's board remains committed to resetting the company's balance sheet. Their goal is to return the company to a position where it can capitalise on growth potential in its core advanced nutrition and foodservice businesses. The first step in this process was completed Monday, with a $130 million payment made to Synlait's banks. Synlait has assured stakeholders that it is still on track to meet minimum underlying earnings required for bank covenant purposes. However, this latest development underscores the ongoing challenges facing the company as it attempts to navigate financial difficulties and restructure its operations. Government proposes cap on pine forests in Emissions Trading Scheme The Coalition Government has unveiled plans to limit the amount of pine trees allowed in the Emissions Trading Scheme (ETS), aiming to protect farmland from excessive conversion to carbon forests. Climate Change Minister Simon Watts announced this policy as part of a comprehensive draft Emissions Reduction Plan. The plan outlines a strategy to achieve the second emissions budget through a combination of gross emission reductions and net offsets, including forestry. However, the government recognizes the need to manage unintended consequences of the current system. Planting permanent pine forests on inexpensive rural land has been a cost-effective method for reducing carbon emissions in New Zealand, often at a quarter of the cost of other reduction methods available to businesses. This has led to a significant increase in ...
