What is nutrient trading?
Nutrient trading is a method for managing nutrient use by placing a cap on total nutrient losses within an area or catchment and introducing a system of nutrient allowances (credits) that can be bought and sold. It provides a mechanism to use nutrients for the best economic gain. It allows enterprises with high nutrient requirements or losses (for example, dairy farming) to purchase credits from enterprises with surplus allowances (for example, forestry).
Nutrient trading has been introduced to the Lake Taupo catchment in order to achieve a cap on the amount of nitrogen entering the lake, and encourage the most efficient economic use of nutrients within that cap.