BIS Review 63/2007  9  Figure 13: Dairy land prices and house prices  More conversions seem all the more likely considering the less favourable returns available from sheep and beef farming at present. The implications of a higher conversion rate would be another step-up in on-farm investment which would in turn lead to further increases in dairy sector debt levels.
Figure 14: Dairy sector credit  Changing land use would also bring fresh consideration of the environmental impacts arising from increasing milk production. Examples include water allocation for irrigation in Canterbury and the run-  10  BIS Review 63/2007  off implications of intensive nitrogen use.