The only reason a large part of the New Zealand pastoral sector has remained in business in the last 20 years is because of the high rate of capital gain on farmland. Much of this increase is owing to non-farming factors such as population increases, lifestyle blocks and more lucrative uses for land such as forestry. The lack of profitability is owing to the fact that the industry is still largely in the 'commodity' trap which comprises 80% of exports. A massive change of direction to added value niche products is required if the inevitable decline of the industry to third world status is to be arrested. However, there are some very promising signs within the country that the wine industry model can be developed in the food industry. Regional characteristics and a New Zealand style "terroir" are emerging with a number of very successful small food businesses setting new standards and a new philosophy. International trends in the food industry suggest a superb window of opportunity for New Zealand in the area of high value clean green nutritional foods. This challenge must be accepted if the pastoral sector is to survive as a viable force in the New Zealand economy. Keywords: commodities, food, regions, terroir, nutrition
