The National Party has also made similar claims.
Forestry Minister Shane Jones called a media conference this morning to "defang the misapprehension that the one-billion-trees strategy is threatening the viability of rural New Zealand".
Over the last 10 years, roughly 7000ha per year transferred from forestry into farming, Jones said.
"Farming probably consumes about 12 million hectares of our land – the vast majority of that is hill and country farming. There is 1.7 million hectares of forestry [in New Zealand]."
"We are in a state of transition," Jones told media.
O'Connor said after spending three days at Fielddays, he became aware of a "perceived notion that forestry is coming to take over dry stock farming in New Zealand".
That, however, was "a long way from the truth".
He said the one-billion-trees programme was not subsidising large-scale afforestation.
"What we are looking to do is to help farmers put the right trees in the right place."
The Government has set aside $240 million to incentivise farms to plant more trees
The Government would pay $1500 per hectare of pine forest planted, $1800 per hectare of Manuka trees and $4000 per hectare of mixed native trees.
Earlier this month, National Leader Simon Bridges said hill country farmers were concerned about the impact of the one-billion-trees programme on rural communities.
"The arbitrary target is overriding best land use, resulting in trees being planted in the wrong place.
"The Government needs to be cautious of subsidising forest plantings and skewing the overseas investment rules against pastoral farming."
"We will not let rural New Zealand fade into a sea of trees."
But Jones disputes this.
He said today that if all of the new plantings of the trees was on unproductive farming land, it would equate to around 3 per cent of all farming.
Jones this morning also said the Government has committed to 68 million trees this year.
He said he "very much" feels like the policy is on track.
"Isn't it strange; if I'm too successful, I enrage the landowners who don't want more trees on the land.
"And if I'm not successful, I might be a botanical version of KiwiBuild – I can guarantee you that's not happening to me as an NZ First politician."