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Bold actions required by New Zealand’s agricultural sector to help steer ‘food transition’ – Rabobank NZ CEO tells industry

Bold actions are required by New Zealand’s agricultural industry if it’s to take advantage of the global food transition, Rabobank NZ CEO Todd Charteris has told the sector.

Speaking at the Primary Industries New Zealand Summit in Auckland earlier today, Rabobank NZ CEO Todd Charteris said New Zealand’s agricultural sector — and others around the world — was currently grappling with how to the tackle the twin challenges of increasing food production and lowering greenhouse gas emissions.

“With the world population expected to grow to 10 billion by 2050, the global agricultural sector has a big job on its hands to ensure this growing population has access to sufficient, safe and affordable food,” he said.

“But at the same time, the sector also needs to reduce the greenhouse gas emissions stemming from food production that risk warming our entire planet.

“As efficient food producers, New Zealand’s farmers and growers have a moral obligation to produce food over and above farmers in many other parts of the world. If New Zealand steps back from food production, what fills that gap could be something quite detrimental to the environment. So, as an industry, we need to move forward on both fronts – increasing food production to feed the world and reducing our environmental impact.”

Todd at the Primary Industry Summit

Todd at the Primary Industries Summit

Mr Charteris said New Zealand “earned its living” through food and agriculture and the country’s food producers were strongly positioned to take on this challenge.

“The sector is receiving strong signals from the government, consumers, and the community to reduce its emissions’ profile and history shows New Zealand agriculture is innovative and adaptive when presented with a problem and given the time and resources to solve it,” he said.

“And with these factors in its favour, the sector is not only well placed to produce large volumes of top-quality food for global consumers, but to set the standard for the rest of the world with regard to sustainable food production.”

While this was the case, Mr Charteris said, a global leadership position would only be attained if the sector took bold actions that helped steer the industry through the food transition.

“Climate change is complex and, with food and agri sector participants at different stages of the journey of acceptance and response, bold actions will be required to ensure the sector stays on track to meet its commitments under the Paris Accords. We need to remain ahead of the issues and control the direction of travel, because if we don’t, retailers, consumers, competitors and regulators will impose their solutions on us,” he said.

Four key actions

While acknowledging the reduction of emissions would be challenging, Mr Charteris identified four key actions to help guide New Zealand’s food and agri industry on the pathway forward:

  • Setting up a ‘swarm’ effect of innovation;
  • Kicking food waste ‘into touch’;
  • Making meaningful gains through precision agriculture; and
  • Getting emissions offsetting right.

“New ideas, technologies and alternate systems will be critical for the sector to make the necessary changes that allow it to meet the market, and the first of these actions is to set up a ‘swarm’ effect of innovation,” he said.

“We need to embrace the uncertainty since you can’t fully plan innovation and develop a systematic approach that creates a ‘swarm of innovation’ by ensuring innovations work, are widely dispersed, and easily accessible. This would also involve upskilling the agricultural workforce and their contractors and ensuring best innovation practice is adopted while roadblocks are removed.”

The second action, Mr Charteris said, was kicking food waste ‘to touch’.

“Food waste is a major source of emissions, both at the production stage, but also at the consumption stage — as illustrated by the recently-released Rabobank-KiwiHarvest food waste research which found Kiwi household are now throwing away a whopping 13.4 per cent of their weekly food spend,” he said.

“The strategy aims to encourage a circular economy where products have a return cycle that allows reusable materials to be kept in circulation.”

Mr Charteris said the next key action was making meaningful gains through precision agriculture.

“Precision agriculture adds a systematic component to collecting farm data to support decision-making. It can be used on or off-farm and increased use of precision agriculture techniques will not only help optimise inputs into a production system, but also improve animal husbandry and horticultural productivity,” he said.

The fourth and final initiative, Mr Charteris said, was getting emissions offsetting right.

“Farmers and growers are keen to ensure an integrated approach to planting trees on farms as they fear conversions of whole farm will become more likely as carbon prices increase under the Emissions Trading Scheme,” he told the summit.

“A whole of catchment coordination could provide more balance, to strategically plant trees in the most beneficial areas.”

Government support vital

Mr Charteris said an alignment of private and public incentives would be essential to support these actions and to allow the sector to make steady incremental gains.

“Governments need to set a consistent framework that allows farmers to embrace innovation and benefit financially from the emission reductions they deliver to society,” he said.

“In due course, preferential trade agreements may need to include carbon reduction in agriculture to give preferential treatment to ‘carbon-efficient farmers’ over the ‘cheap’ suppliers. As without this alignment of incentives, meeting climate change goals will be difficult.”

On this point he commented that “it’s positive to see this type of arrangement included in the NZ/ EU free trade agreement that was announced last week.”

Rabobank’s involvement

Mr Charteris said industry stakeholders needed to do the right thing and Rabobank was committed to playing a role to help transition the New Zealand agri sector to a higher production – lower carbon future.

“We’ve made a start on this journey by signing up to the United Nations net zero global alliance, benchmarking the non-financial aspects of client businesses to ensure we are banking with responsible farmers and growers, and undergoing Toitu accreditation to enable us to report on our own emissions,” he said.

“We’re also finalising a new white paper which looks at the climate change challenge for New Zealand agri-business and expands on some of the ideas and actions outlined in my address today. This paper will be released in the coming weeks and our intention is to engage with farmers, industry stakeholders and politicians over the months ahead to discuss the paper’s key findings and how the bank can work together with others to steer the coming food transition.”

Rabobank New Zealand is a part of the global Rabobank Group, the world's leading specialist in food and agribusiness banking. Rabobank has more than 120 years’ experience providing customized banking and finance solutions to businesses involved in all aspects of food and agribusiness. Rabobank is structured as a cooperative and operates in 36 countries, servicing the needs of about 8.6 million clients worldwide through a network of close to 1000 offices and branches. Rabobank New Zealand is one of the country's leading agricultural lenders and a significant provider of business and corporate banking and financial services to the New Zealand food and agribusiness sector. The bank has 30 offices throughout New Zealand.

Media contacts:

David Johnston
Marketing & Media Relations Manager
Rabobank New Zealand
Phone: 027 477 8153

Denise Shaw
Head of Media Relations 
Rabobank Australia & New Zealand 
Phone: +612 8115 2744 or +61 2 439 603 525