For Australian dairy farmers, the outcome from this week's climate change talks in Glasgow will not change what they do in their businesses next week, however, in the medium term, as our customers overseas increasingly act on climate change, it means we will need to reduce climate-warming greenhouse gas (GHG) emissions on-farm.
Our first step is to validate the sources of GHG emissions on-farm and calculate a carbon footprint, and then work out to how to link reducing emissions with improved production outcomes.
We know climate change is real. Dairy farmers are feeling the impacts on production with increased variability in pasture growth patterns, reduced rainfall, heat impacts on milk production and increased incidence of extreme weather events.
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Australian Dairy Farmers (ADF) supports the National Farmers' Federation's climate change policy which states that provided certain conditions are met, NFF supports an economy-wide aspiration of net zero emissions by 2050.
The Australian dairy industry already has a climate target for 2030 - a reduction of 30 per cent in GHG emissions intensity across the supply chain.
This is the existing target for reducing GHG emissions in the Australian Dairy Sustainability Framework.
Importantly, we are making progress towards our 2030 climate target - 94pc of Australian dairy farms have implemented practices on their farms to reduce or offset their GHG emissions.
Although a methane 2030 target is not part of the carbon net-zero by 2050 policy adopted by federal cabinet, support is building outside of Australia for a 30pc reduction in global methane emissions by 2030.
The GHG emissions target in the sustainability framework does cover methane and carbon.
This matters to dairy farmers because at least 90pc of dairy GHG emissions are generated on-farm, and of these 50-60pc are emitted when dairy cows digest food.
The outcomes from the Glasgow talks, together with the details in Australia's pledge for carbon net-zero by 2050, will support the dairy industry's review of its existing 2030 target for reducing GHGs intensity by 30pc.
Notwithstanding the challenge of climate change, the growth in dairy demand from export markets forecast by market analysts does represent an opportunity for the Australian dairy industry.
This opportunity will be examined when the question, Is Australia one of the few places with potential to outperform other dairy exporters in supply growth? is discussed at the Australian Dairy Industry Council's virtual 'breakfast' on November 24.
Three critical market-shaping trends for the global dairy industry are:
- Changing consumer behaviour and a need for better consumer insights;
- Investing in digital and analytics capabilities; and
- Improving responses to supply chain disruption.
These trends, identified in a report prepared by McKinsey & Company, have been accelerated by the disruption of COVID-19.
As the report states, dairy businesses can respond in various ways to address disruptions, including:
- Invest in technology and research to improve the sustainability, health, and wellness attributes of their products;
- Develop insight capabilities to enable consumer-focused innovation;
- Embrace digital as a tool to capitalise on opportunities;
- Improve agility, flexibility and resilience in their operations; and
- Strengthen workplace culture to attract and retain talent.
At an industry level we can:
- Reimagine how the industry defines sustainability performance to align with social and corporate incentives;
- Make dairy the career of choice for talented people to strengthen the industry; and
- Invest in research and consumer education that articulates the benefits of dairy.
It often takes a crisis such as COVID-19 to reveal what we can achieve together.
In Australia, the dairy supply chain's fast response to COVID-19 showed the adaptability in our value chain.
As chair of the National Response Group, I saw first-hand how collaboration makes us stronger.
In this my last Dairy Insight column as ADF president, I urge dairy farmers to think of opportunity and challenge as two sides of the same coin.
When we do so, we create the future we want.
Together, COVID-19 and climate change are changing the way we produce dairy foods - how we respond to these disruptive, mega forces now will contribute to our success in the future.
Article supplied by Australian Dairy Farmers.
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