The Agriculture Minister has acknowledged farmers' concerns over carbon farming and hinted that more rules around the practice could come into effect if Labour is voted back into power in September.
"Farmers are rightfully concerned," O'Connor told Rural Exchange over the weekend.
"We don't want good farmland to go into trees."
Debate over carbon farming has raged since amendments to the Emissions Trading Scheme (ETS) were made last month.
With New Zealand's goal to be carbon neutral by 2050, the ETS has effectively turned carbon into a currency. People receive credits for planting trees which can then be sold to companies to offset their emissions.
But many fear it incentivises the acceleration of productive farmland being converted to pines planted for carbon credits.
O'Connor said the Government's current policy concerning the carbon farming and the ETS came as a result of compromises.
"We're in a coalition government and we've negotiated these positions, we've got a billion trees - that was an agreement with New Zealand First, we rolled that out - and two-thirds of that has gone to indigenous trees. So that's good, but you do have this whole issue of carbon farming which is a new evolution of forestry development and there have been some good farms planted and we've been monitoring it," he said.
"The overall total level of land in forest is still not anywhere near what was planted in the 1990s on an annual basis, but farmers are rightfully concerned."
O'Connor admitted that in some areas productive farmland struggling with dry conditions had been lost to forestry plantations.
"They've swooped in there and farms have been purchased and the trees have gone in and that's a 30-year lock-up," he said.
Earlier this month the Labour Party promised to revise the National Environmental Standards for Plantation Forestry - regulations under the Resource Management Act (RMA) for forestry planting - if re-elected to Government in September. The changes would mean resource consent from the local district council would be required to plant forestry blocks larger than 50 hectares on "elite soils" - those classified as land use capability (LUC) classes 1-5, which means they are more suitable for agricultural production.
"That good land should stay for farming," O'Connor told Rural Exchange.
"We are bringing in policies that will be different from what we have at the moment under Government, and that's a Labour Party policy."
His comments come as the latest Newshub-Reid Research Poll over the weekend showed Labour sitting at 60.9 percent - up 4.4 points - the highest it's been in the poll's history. Based on those figures, Labour would be able to govern alone.