Dairy farmers are being warned to focus on their energy and greenhouse gas efficiency if they want to remain competitive with their European counterparts.
An AgResearch-commissioned sustainability study of the country's farms found that while they remained more efficient than their European Union counterparts, the gap was closing.
AgResearch principal scientist Dr Stewart Ledgard said dairy farms here were ahead of those in the European Union (EU) in terms of on-farm energy use and food miles.
However, their "competitive advantage is diminishing", he said.
"Farmers need to start using knowledge of the main factors influencing greenhouse gas emissions to improve farm practices or plan intensification options and retain their competitive advantage."
Increasing productivity per animal and optimising use of effluent to reduce fertiliser used were two options to decrease emissions, he said.
Farmers are to join the Government's Emissions Trading Scheme (ETS), aimed at driving down New Zealand's greenhouse gas emissions, in 2013.
The agriculture industry makes up almost 50 per cent of total New Zealand emissions.
Meanwhile, New Zealand is being warned it will be a third world country in 20 years without genetic modification (GM).
The warning came from PGG Wrightson group general manager of technology services Paul Tocker.
"The opportunities within GM are incredible but it's a fast-moving science and if we don't keep up with it as a nation it'll pass us by and we'll never be able to re-enter again," he said.
GM can be used to create drought-resistant plants with fewer greenhouse gas emissions and better production levels, Mr Tocker said.
