Federated Farmers and the New Zealand Forest Owners Association (NZFOA) both told the Otago Daily Times they were concerned with the final form of the Climate Change Response (Emissions Trading Scheme — Forestry Conversions) Amendment Act 2025.
Federated Farmers executive member Dean Rabbidge, of Wyndham, said he was disappointed with the policy changes, which did nothing to protect certain classes of valuable farming land from conversion.
NZFOA chief executive Dr Elizabeth Heeg said the law was going to have a "chilling" effect on the forestry sector at a time when it was already facing external threats.
United States President Donald Trump recently announced there would be a 10% tariff on lumber products going into the US, affecting New Zealand’s more than $300million a year timber trade.
Dr Heeg said the tariff issue compounded pressure on the industry brought about by the new restrictions.
"We now have nurserymen who are saying, ‘well, with these ETS changes, we’re seeing a 30% decrease in our orders for next year’," she said.
The new law restricts how much Land Use Capability (LUC) class 1-6 farmland can be converted into forestry and profit in the emissions trading scheme (ETS).
Up to 25% of class 1-6 land on each farm can enter the scheme. Beyond that, an additional 15,000ha of class 6 could also be converted to exotic forestry and registered.
Mr Rabbidge said the more hilly land, class 6 and 7, was still highly productive for farmers for breeding and storing stock and would be left vulnerable by the new laws.
Class 6 and 7 land also made up 225,000ha, or a "fair whack", of Southland, he said.
Dr Heeg said there was a time lag in her industry, as pines took 30 years to grow, which meant they would not see the outcome of the restrictions for some time.
"I think our concern is what’s going to happen longer term for our wood supply ... and it’s not something that we’ve really seen modelled or forecast as part of the changes," she said.
Mr Rabbidge said that from his sheep, beef and dairy farm he was looking at a "stunning" 1500ha property that had just been planted in trees in the last two months.
Dr Heeg said the "boom" in conversions of farms to forestry was a misconception and forests had just changed location.
"At the national level, the forest estate hasn’t actually increased," she said.
"It’s just moved around as to where it is regionally."
Mr Rabbidge said his key concerns with exotic forests were that they generated large populations of pests and were unmanned, meaning fewer jobs and a collapse of rural communities.
Alternatively, Dr Heeg said forestry did create jobs, although they might look different from farming, and pest-control was an increasing problem nationally, which could bring about the creation of jobs.
Both said their organisations would be working with central government to fine tune the Act’s processes.
The Act received royal assent on September 23.
The Act aimed to regulate the conversion of arable land into forestry and "carbon farming".
Carbon farming is when the planting of trees, in offsetting carbon, is converted into profit under the ETS.
