Agriculture outlook strong - Groser

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New Zealand's agriculture sector is in the best trade position for 40 years, Trade Minister Tim Groser says.

In a speech to Federated Farmers, Mr Groser said while the world was now suffering a severe downturn in trade in the longer term New Zealand had great opportunities.

These included:

* a world population whose food supply needs to grow by 20 percent in the next 50 years;

* predicted income growth in developing countries that could not provide the protein their emerging middle class will require;

* water availability in New Zealand - agriculture consumes 70 percent of the world's fresh unfrozen water and many countries do not have enough water;

* trade policy and agreements that allow access to markets.

Among challenges were the need to develop supply chains in Asia and deal with new demands in traditional markets in Europe and North America.

"The real risk is not governments. It is that our customers, or rather the retailers that make the crucial decisions on sourcing, may walk away from New Zealand over environmental, climate change or other ... production processes and methods.

"That is a real risk, don't treat it lightly."