Worldwide demand for livestock products, including dairy, has been strong in recent times, with the sustained expansion of Chinese consumption a key factor.

Nobody can know what the trajectory will be in the years ahead and there could be shifts in the composition of food demand which would slow, or even reverse, the recent trend.

But whatever the level of global demand, it will not be influenced by the domestic policies of exporting countries.

Satisfying world demand

Their decisions will determine where production, to satisfy world demand, will take place and constraints in one country will bring forth alternative supply elsewhere.

To compute the impact of supply constraints in any one country, it is necessary to concede that these measures will not directly affect aggregate global demand.

Nor will national supply constraints reduce the global carbon footprint of the livestock industry, unless the resultant geographical pattern of output sees a shift from high-emitting locations in satisfying whatever aggregate global demand turns out to be.

If a country with substantial exports cuts output, the impact on global emissions will depend on the reactions of others

There is thus a risk of doing the wrong thing when countries are required to manage downwards their emissions from the livestock sector.

If a country with substantial exports cuts output, the impact on global emissions will depend on the reactions of others.

If the lost output is replaced with herd expansions in territories where emissions per unit of output are higher, there could even be a perverse outcome.

Apparent success in cutting output, and hence emissions when measured on a production basis, in one country could even result in higher worldwide emissions.

Shifting missing output

The missing output simply shifts to less favourable locations, where per unit emissions are higher.

This is a feature, not a bug, in the system of emission measurement.

For certain sectors, of which agriculture is one, emissions are attributed to the country of production rather than the country of consumption.

Any country that has a large fertile land area and a small population will tend to be an agricultural exporter and hence an apparent source of a high level of agricultural emissions.

This is a consequence of the idiosyncratic manner in which farm emissions are attributed.

Several areas in northern Europe are doubly affected by the production-based measurement system and Ireland happens to be one of them

The measurement system is doubly perverse when high current production reflects natural climatic advantages, including in certain cases the ability to achieve carbon efficiency as well as commercial market success.

Several areas in northern Europe are doubly affected by the production-based measurement system and Ireland happens to be one of them.

If Ireland’s emissions in the food sector were measured as is done with energy, for example, disregarding country of origin and based on country of consumption, the apparent ‘excess’ emissions would disappear.

Difference of opinion

The difference of opinion among climate scientists on the actual impact of biogenic methane is a separate issue.

Several prominent experts, whose views have been covered extensively before, are of the view that methane should attract a lower coefficient than other greenhouse gases, since it persists for a far shorter time in the atmosphere.

If this is truly the case, the measurement procedures adopted by the Intergovernmental Panel on Climate Change (IPCC) are faulty and need to be modified.

This is a technical rather than an economics question and it is time it was resolved.

It makes economic sense to discourage consumption, wherever it takes place, of the carbon-intensive products and services

The economics, however, is clear. World production and world consumption of the various products and services that generate emissions coincide, since planet Earth does not trade with Mars.

It makes economic sense to discourage consumption, wherever it takes place, of the carbon-intensive products and services and a carbon tax is the simplest way to do this.

Production should take place wherever it is most efficient, while the correct incentives are built in courtesy of the consumption tax.

The allocation of quantitative targets to each of the world’s 200 countries is a political outcome uninformed by any notion of economic efficiency.

It would be insane to limit oil production in the countries where it is most plentiful and cheapest to produce. The same goes for dairy produce, but that is not the way the sums are done.

Measurement system

Ireland is stuck with a measurement system which has created in the public mind, at least in urban areas, the impression that there is something wrong with producing so much butter and cheese in Ireland and that there is a case for herd limits.

Research commissioned by the European Union has suggested that Ireland, along with some other countries and regions in this part of Europe, is a good place to meet demand for products such as butter and cheese and that demand can be met with lower carbon emissions in these locations.

The corollary is that herd limits in Ireland will displace production to less favoured locations in southern Europe and elsewhere, resulting in higher cost and greater emissions. If the science supports that finding, so should the policy.