Australia’s net zero sector plan for agriculture and land

What is the Agriculture and Land Sector Plan? 

This is a framework to guide Australia’s agricultural sector to lower emissions. It is one of six sectoral strategies under the national Net Zero Plan.  

The goal is to lower emissions while maintaining agricultural productivity, supporting biodiversity, and ensuring benefits for regional communities.

Focus areas include reducing methane from livestock, improved fertiliser management, and increasing carbon sequestration.  

It does not set a mandatory emissions reduction target for the agriculture sector.  

It emphasises voluntary adoption, innovation and partnership by offering significant incentives for participation.  

The upcoming Safeguard Mechanism review could mean a future focus on driving onsite abatement for larger industrial emitters.

Agriculture sits at the centre of a much larger economic and environmental ecosystem and everyone connected to that system will feel the impact of decarbonisation. That impact will be uneven, with some groups facing a difficult transition, while others stand to benefit.  

Within agri, the impacts span everything from broadacre cropping operations to intensive horticulture, dairy and large-scale cattle stations, regardless of land size or production type. According to Ross Paterson, National Agribusiness Leader at RSM, “Anybody that’s either a farmer or pastoralist is basically going to be caught up in it.”  

Livestock producers face particular pressure because methane is, “the main driver in terms of emissions in the agri sector,” says Paterson. Cropping enterprises, by contrast, may find it easier to decarbonise, creating a different set of challenges and opportunities across subsectors.

Nicki Ledger, a Manager in RSM ESG and Climate Services team, stresses that the effects do not stop at the farm gate. She explains that the agriculture plan reaches across “the entire value chain around food and fibre industries.” Processors, exporters and retailers all have a stake, as do banks and insurers who increasingly factor emissions into lending and risk decisions. 

For a variety of reasons, agriculture is unlike other sectors. For one thing, it is the only sector with net negative emissions, when factoring in land used as a carbon sink. Added to that, agricultural emissions are not simply a function of fuel or electricity use, but of living systems. 

Methane from livestock and nitrous oxide from soils are inherently harder to abate, and that reality places firm limits on how quickly emissions can fall without fundamentally changing production systems.

Because methane is a biological by-product, not an industrial input, Ross Paterson is cautious about promising absolute outcomes. “When I’m talking to a livestock producer, we’re not trying to talk about reaching net zero because as it stands at the moment, probably the science isn’t quite there to deliver on what would need to happen to get to net zero,” he explains. Instead, the language he uses is deliberately more pragmatic: “We’re talking about trying to reduce emissions.” Rather than focusing on whether farmers are “meeting” a target, he argues for a more credible narrative:

Ledger notes that many emissions reductions often come not from headline technologies, but from incremental improvements in farm efficiency. “It’s often the small iterative changes that cut emissions and save money because, in agriculture, emissions usually reflect lost efficiency or unused resources,” she explains. In some cases, she adds, the emissions savings can even help pay for productivity upgrades through carbon credits.

Paterson voices his agreement, pointing out that many productivity improvements also reduce emissions and vice versa. One example Paterson describes involves using precision farming technology for pesticides.

New boom sprays equipped with cameras can identify weeds and dramatically cut chemical use. “That can reduce the application of chemicals by about 80%,” he explains. The primary motivation for adopting the technology is economic, saving on chemical costs and time, but the emissions benefit follows naturally. “There’s a really good alignment… between a lot of productivity decisions and reducing emissions,” he says.

The same logic applies across energy use. On-farm electricity is a major cost for many producers, particularly in energy‑intensive sectors like dairy. Paterson describes clients who are frustrated by rising prices and unreliable grids. The solution — installing solar and generating their own power — is not driven first by emissions targets. “Straight away you’re addressing two of the main key issues for them… unreliable power and having no control over what they’re going to be paying for that power into the future,” he says. Emissions reduction becomes an added benefit of solving a business problem, not the sole justification for the investment.

Nowhere is this connection clearer than in livestock systems, where biological emissions like methane are hardest to eliminate outright. Here, Paterson argues that productivity improvements are one of the most practical pathways to lower emissions. “The sooner you get cattle off the farm, the sooner you get paid for them, the more money you make,” he says. Faster growth rates — achieved through better genetics, improved pastures and controlled grazing — shorten the time animals spend emitting methane. “Essentially you’ve reduced the emissions just by shortening that time frame,” he explains. The business driver is profitability; the emissions outcome follows.  

Innovation in agriculture is well underway, but tends to focus on practical and incremental improvements over headline-grabbing breakthroughs.  

Methane-reducing feed additives, such as asparagopsis seaweed, have shown promise, but it’s important to be realistic about their limits. Ledger notes that it is “quite challenging to deliver it into the cow herd with enough volume and consistency for it to actually work,” making it more suitable for feedlots than extensive grazing systems.

Ross Paterson agrees there is no quick fix: “I don’t think there is a silver bullet… it works in certain circumstances, but it hasn’t got that ability at this stage to change the whole cattle industry.”  

He repeatedly returns to soil carbon projects as one of the most exciting developments in the sector. He describes producers integrating mixed‑species pastures, controlled grazing and regenerative practices that allow them to sequester carbon while continuing to run profitable livestock operations. “He’s got two income streams off that land,” Paterson says of one early adopter — earning carbon credits while still grazing sheep.  

These dual‑use models challenge the idea that emissions reduction must come at the expense of food production — and create competitive advantages for landholders able to unlock multiple revenue streams from the same asset.

Innovation is also emerging in farm systems design, particularly in response to climate risk. Ledger highlights examples of landholders combining soil carbon projects with reforestation projects - reintroducing trees, planting shelter belts and using marginal land more strategically. Trees provide shade, reduce erosion and improve soil quality, while also generating carbon credits. “It’s taking a whole farm approach to how you can build benefits on the land as well as reducing emissions,” she says. Producers who redesign their landscapes in this way are better positioned to withstand extreme weather while meeting emerging market expectations around biodiversity and stewardship.

Paterson notes that advisors working across many clients can see what early adopters are doing and share those insights. “Have you considered this? Because we’ve seen one of our clients do this and it seemed to solve a problem and at the same time reduce emissions,” he says. Farmers who are open to learning from peers and trialling new approaches are gaining an advantage over those who wait for fully mature, risk‑free solutions.