Forestry Minister Shane Jones is considering reining in on conversions of farmland to forestry, and also issued a warning to foreign-owned forestry companies that make up nearly 75 per cent of the industry.
He said too many foreign companies had not provided enough access for domestic processors to get timber.
"Some of the international owners haven't covered themselves in glory," Mr Jones said.
"They don't believe that's their role - their role is to maximise their interests in New Zealand. But hey, all industries can lose their social license. And if you think the forestry industry is beyond further regulation, then just have a look at oil and gas,” the Minister warned.
Minister Jones, who is also Minister for Regional Economic Development, said he was sympathetic to the concerns of rural communities who fear their towns could be hollowed out by conversions of productive farmland into commercial forests.
"I feel it deeply. I do," he said.
"If there are things that I need to do, either through mitigation or other sorts of interventions, then I want people to know I'm up for the challenge."
But farmers had to accept there was a transition away from dairy to forestry.
"For the last 10 years we introduced 100,000 cows per year for 10 years. The vast majority of the land conversion has been from forestry into farming and now we're seeing a small reversion from farming back to forestry," the Minister said.
"We're in the midst of the land transition process, we are correcting what I think has been a massive gamble on farming, particularly dairy. The trick for me is to help manage that transition in a way that it is not fatally disruptive."