Danish farmers worried carbon tax will cause lower production

Denmark's farmers on Wednesday voiced concerns that plans to levy a carbon emission tax on farming as part of efforts to fulfill Denmark's ambitious environment objectives would require them to minimize production and close farms.

Denmark, a significant pork and dairy exporter, could become the very first nation worldwide to impose an emissions tax on farming, a relocation that has broad political backing in the country, after New Zealand in 2015 pressed back such a tax to the end of 2025.

A carbon tax on farmers might help Denmark achieve its legally-binding 2030 target of cutting greenhouse gas emissions by 70% from 1990 levels.

But such a measure would likewise mean greater costs for farmers and as an effect reduce production by as much as one-fifth, a government-commissioned group said in a report on Wednesday.

A tax of 750 Danish crowns ($ 109) per million lots of carbon dioxide (CO2) discharged would have the greatest effect. The group likewise considered lower taxes of 375 crowns and 125 crowns.

These models are based on something extremely frustrating, namely that environment reduction can just come by minimizing production, Peder Tuborgh, CEO of dairy producer Arla Foods, told .

Tuborgh stated brand-new innovations had assisted Arla's 9,000 farmers in Denmark, Sweden, England, Germany and Benelux reduce emissions by 1 million heaps in the last 2 years.

There is an innovation path, he said. We want to continue that journey, rather than needing to close down our production.

Over half of Denmark's land is farmed, with agriculture accounting for about a third of the country's carbon emissions, according to Danish climate think tank Concito.

The agriculture sector has become a political battleground as the European Union aims to fulfill its net no emissions target by 2050. Farmers throughout the bloc have been opposing for weeks, stating they are dealing with increasing costs and taxes, bureaucracy, and excessive ecological guidelines.

The scenarios set out by the federal government advisors would decrease farming production by in between 6% and 15%, with livestock and pig production falling by around 20% under the harshest taxation situation.

It will be relatively remarkable if we picked to decrease that course, Jais Valeur, CEO of Europe's biggest pork manufacturer Danish Crown, informed TV2.

It's essential that we encourage our best farmers to end up being better so that we can blaze a trail for a sustainable shift, he said.

(source: Reuters)