of paraquat Presentation for reassessment hearing September 2019 - - PowerPoint PPT Presentation

Estimating the economic contribution

• f paraquat

Presentation for reassessment hearing

September 2019

Estimation factors

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Crop contribution to GDP Herbicide contribution to crop yield (%) Share of paraquat in NZ herbicide use (%) X X = Crop contribution to GDP attributable to paraquat

• Baseline economic impact expressed in terms of crop contribution to GDP

attributable to paraquat

• Three components, as follows:

From NZIER (2015) From Gianessi (2007) adapted for NZ conditions From Manktelow (2005) and interviews

• Industry growth rates used to derive 2017 total value at risk,

dominated by clover and kumara

Baseline estimate is $39m-$75m per annum

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Paraquat contribution to GDP by crop Crop HIGH LOW Apples $1,539,643 $484,729 Brassicas (cabbage, broccoli, cauliflower) $1,301,712 $409,820 Clover (seed crop) $44,627,873 $14,050,275 Green beans $127,249 $40,062 Kumara $12,041,355 $12,041,355 Lettuce $36,196 $11,396 Lucerne $10,831,136 $10,831,136 Onions $603,303 $189,939 Plantain (seed crop) $849,339 $267,399 Pears $244,815 $77,076 Pea (seed crop) $1,059,759 $333,646 Potatoes $1,208,909 $380,603 Spinach and silverbeet $30,990 $9,757 Stone fruit $136,978 $43,125 Strawberries $62,176 $19,575 Sweet corn $125,685 $39,570 TOTAL $74,827,118 $39,229,462

Restricted scenario based largely on application rates and frequency

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GDP reduction most material at 300 g a.i/ha, mainly due to clover

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$0 $10 $20 $30 $40 $50 $60 $70 $80 600 500 400 300 200 100 GDP contribution (attributable to paraquat) at risk (NZD million) Maximum paraquat concentration allowed (g a.i./ha) High use Low use

Final results

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• A ban on paraquat use would result in a minimum of $39

million and a maximum of $75 million of annual GDP loss per year (less than one half of one per cent of annual GDP nationally)

• Restricting the application rate of paraquat to:
• 300 grams of active ingredient per hectare (g a.i./ha)

would put up to $72 million in GDP at risk annually;

• 400 g a.i/ha would put up to $25 million in GDP at risk

annually;

• 600 a a.i/ha would put up to $0.14 million in GDP at

risk annually

Supplementary comments

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• An estimation process, relying on key assumptions and

translation of inputs from overseas in the absence of ‘hard data’

• Initial estimates were revised upward by between $9

million and $15 million (from between $30 million and $60 million) following submissions

• Results were largely insensitive to alternative parameters