Proving the concept
Paraway Pastoral Company (‘Paraway’) – one of Macquarie Asset Management’s operating companies – manages 4.4 million hectares of agricultural land across Australia, with the capacity to run more than 220,000 cattle and 250,000 sheep, and it has taken an active role in trialling nature-based solutions in the carbon and biodiversity spaces.
This has seen it become an early participant in programs run by the Australian Government to explore how multiple, on-farm land management practices can be incentivised to increase biodiversity outcomes and diversify and bolster farm incomes while not losing productivity or output.
One such initiative is the Agriculture Stewardship Package, which explores the benefit of ‘stacking’ financial payments for environmental stewardship programs on top of those received for carbon abatement activities under the Emissions Reduction Fund. Still undergoing trials, the package could help demonstrate the importance of the interrelated nature of the work needed to enhance biodiversity, reduce carbon levels and maintain productivity at the same time. Paraway was among the first agricultural land managers to have a project approved by the program.
“Stacking is appealing as it seeks to balance capital being invested in carbon removal strategies with the preservation and, in some cases, the restoration of biodiversity. We need to be careful that carbon offsetting programs don’t inadvertently solve one problem but promote another through the destruction of biodiversity; there’s a need to understand the benefit and ways of achieving both. It’s both a complex and interesting space, and one Paraway has taken a lead role in exploring – both directly and by working with small and medium-sized pastoral businesses,” says O’Leary.
Paraway also continues to participate in the Emissions Reduction Fund itself under an Australian Government initiative exploring how to reduce the emissions intensity of beef cattle production by improving the way herds are managed.
The company is also exploring opportunities presented by new techniques such as using seaweed-based feed supplement to inhibit the production of climate-detrimental methane emissions by ruminant livestock, and has invested in Australian ecotech cultivation company Sea Forest. As well as reducing a herd’s climate footprint by cutting methane production, because the metabolic conversion of the gas uses a fifth of feed energy, limiting it can also increase productivity with a reduced amount of feed – creating more food with less environmental impact.4
“Sea Forest is a prime example of how we are looking for opportunities up and down the supply chain – at where there is greatest opportunity to effectuate change – and investing in trialling and scaling those up for the potential benefit of both our own operations and the broader sector,” says O’Leary.