A forestry professor says the agriculture sector should be required to participate fully in the Emissions Trading Scheme to make it more effective.
The sector has reporting obligations under the scheme but is not required to trade carbon credits.
The Environmental Protection Authority has just released a facts and figures report on the scheme which Professor Euan Mason of Canterbury University said showed New Zealand's climate change policy was a failure.
Professor Mason said New Zealand was the subject of international criticism for its response to climate change and was now the fifth highest emitter of green house gases per capita.
He said agriculture accounts for half of this country's emissions and farmers could trade credits through forestry.
"We've just done an analysis recently and there are approximately 1.3 million hectares of erosion-prone land mainly owned by farmers that's not very productive, that's ideal for carbon sequestration by planting trees.
"One option they would have would be to grow carbon credits on their own land.
"Or, perhaps, if you're a dairy farmer and you didn't have any erosion-prone land, you could go into some sort of partnership with a high country farmer that did have some erosion-prone land. Then the high country farmer would become more profitable and more stable.
"Overall, it would be a better proposition for a high country farmer to have this sort of system because they are the ones that own the land from which the credits could be sequestered. Clearly, farmers have that option."
Professor Mason said a lot of research had been conducted to reduce belching emissions from livestock.
"Although that research is not going to see the light of day for a number of years, I don't buy the argument that farmers have no alternative. I think that's political hot air.
He said the importation of cheap foreign carbon credits, which has recently been prohibited, had created a stockpile of credits that the Government could use to misrepresent New Zealand's compliance with its goal of reducing emissions to 5 percent below 1990 levels by 2020.