Govt to clamp down on forestry speculators

The Government is taking steps to ensure its goal of planting 1 billion trees over 10 years doesn't come at the cost of valuable farmland.

Agriculture Minister Damien O'Connor addressed concerns that overseas investors are buying large tracts of farmland to convert to forestry on Newshub Nation on Saturday morning.

"In some areas, there are genuine concerns about this where there have been a number of farms bought up," he said.  

"We are looking into it. I've had discussions with Forestry Minister Shane Jones, and we'll have to tweak things. We'll look to intervene where we've got large-scale speculation by just a bunch of land traders."

Changes to the Overseas Investment Act in 2018 streamlined purchases of land by overseas investors if it was used for forestry. This lead to an increase in speculators buying land to convert to forest, betting on an increase in the price of carbon. 

As of April this year, North Island forestry land rose from a median price of $6656 per hectare to over $13,000. 

Information from the Overseas Investment Office shows that until the end of August 2019, there have been 19 approvals for sales under the new 'special forestry test'. Eight of those were farm conversions, amounting to 14,229 ha of farmland converted to forest. 

However Julie Collins, deputy director-general of Te Uru Rākau, says the special forestry test has many specific caveats designed to protect the land.  

"The streamlined special forestry test only applies to commercial sales for wood production. Sales of land for carbon afforestation are subject to the same assessment as sales for agricultural use." 

The streamlined rule also places special parameters on the land use, such as public access, protection of habitat for indigenous plants, animals, and historic places.

Collins says despite an increase in forestry, there is no evidence that there has been a corresponding increase in overall farm sales. 

"There have actually been 8 percent fewer grazing and finishing farm sales in the past year, compared with the previous year."

Farming lobby group 50 Shades of Green has organised a march on Parliament set for November 14, with chair Andy Scott saying "the blanket planting of good farmland has reached crisis proportions".

O'Connor didn't provide specifics of what the tweaks might be, but discussions are happening in Wellington on a regular basis.