The collective sigh of relief that agriculture, emissions exposed and unprepared, will be left out of intial stages of Australia’s emissions trading scheme (ETS) was quickly followed by consideration of the wider consequences of the scheme.
"The difficulty that I don't quite have my head around is how much assistance will agriculture get if it's not covered (by an ETS)," said Meat and Livestock Australia’s climate change specialist, Dr Beverley Henry.
"Agriculture will be still exposed to those higher prices through input costs, but because it’s not a covered sector, it isn’t clear what assistance will be provided."
Dr Henry noted that Professor Garnaut was also silent on the subject of research and development funding to help agriculture transition toward lower emissions under the ETS.
Garnaut suggested that half the revenue from carbon permit sales should go to help households, 30pc to exposed industries, and 20pc to research & development.
"But the R&D as he discusses it seem to be largely about clean coal technology," Dr Henry said.
"I think there should be a real effort to direct some of that R&D to mitigation options for agriculture in those early years."
Allan Burgess, president of Australian Dairy Farmers, said it is "a necessity" that Australian agriculture initially be kept out of an ETS.
"We don't have an effective measurement system, we don't have an international accounting system that works, we don’t have the right technologies—put it all together and you have a potential disaster," Mr Burgess said.
"We agree with Garnaut that we aren't ready, and hope that we can work together with the government to develop the best options for playing our part."
Increased input costs because of the impact of the ETS on other industries is a concern, but shouldn't be an economic catastrophe, Mr Burgess said.
"When an ETS scheme comes in, there is going to be a range of new costs across everything, including food.
"We're all going to have to deal with that in what's hopefully a new economic world, because if we don’t adjust our economy, some sections of Australia are going to be affected dramatically."
His major concern is that Australia is taking tough action on an issue that it can't fix, while most of the world's major polluters—including some of Australian agriculture's main competitors—will do nothing.
"What's most critical is the international arrangements, and getting agreements across the world," Mr Burgess said
"Getting this right is bigger than the WTO."
Across the Tasman, Federated Farmers of New Zealand president Don Nicolson applauded the fact that Australian agriculture is able to "take a deep breath" before it participates in an ETS.
The New Zealand government became the first country in the world to bring animal emissions into a trading scheme, but after a flurry of sharply negative economic outlook reports, has delayed bringing agriculture fully into the country’s ETS until 2018.
Mr Nicolson said a big issue for New Zealand’s farmers, and one that Australian farmers needed to watch out for, was inequity over "point of responsibility".
"The end user is paying their carbon charge when they are at the pump, buying fuel; but for some reason farmers have to pay before their produce goes outside the farm gate," he said.
"Why would this country, which relies on the production of food country, why would it bite the hand that feeds it?
"The data we've seen says that an ETS could cause serious economic mayhem to New Zealand, and yet it won't make a scrap of difference to climate change."
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