Rotorua farmer Alison Bentley has been awarded $50,000 to trial two new hazelnut varieties not currently grown commercially in New Zealand, which have a potentially much shorter lead time to production.

The project will conduct field research in the Rotorua Lakes Catchment on the growth management and yield of the new varieties and will involve about 70 trees.

It is one of half a dozen projects totalling almost $1 million that are expected to be signed off by Christmas as part of the Bay of Plenty Regional Council's Low Nitrogen Land Use Fund, says fund manager Anna Grayling.

About $1 million of the $3.3 million fund has been allocated to support landowners with making their required nitrogen and phosphorous reductions as part of a long-term solution to protect Lake Rotorua water quality.

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"If people can earn money out of something like trees and it's more viable or can supplement their income from agriculture and animals, then generally that results in less nitrogen and less phosphorus entering the lake," said Ms Grayling, who noted that animal urine was a major contributor to nitrogen entering the catchment.

"The whole crux of what we are doing is to support landowners to reduce nitrogen and phosphorous in a way that is economically viable for them."

Advisers to the project forecast returns on hazelnuts could reach $7000 per ha.

The project will receive technical advice from Murray Redpath, who has been growing hazelnuts for more than 15 years, and has spoken at recent Rotorua symposiums on the nut's potential. According to Mr Redpath, the New Zealand hazelnut industry covers about 350ha and hazelnuts have been commanding high prices internationally.

The hazelnuts currently grown in New Zealand take about eight years to reach production.

Ms Bentley said the key to the trial was that the new varieties were expected to take only four to five years to produce their first crop.

She currently runs livestock on her Tikitere property but hopes to eventually reduce their numbers.

"The reason I applied to the fund is that it's about using land in a way that supports the environment and feeds the population," she said, noting that hazelnuts were high in protein and other essential nutrients. "But I also believe there is significant potential to grow for the export market as well."

Ms Grayling said other work being funded included growing manuka for essential oils and honey production; developing a land development resource guide bringing together land-use information from a wide range of organisations and individuals; Tipu Whenua, a land-use advisory company that will coach several farm owners to reduce nitrogen loss by 20-40 per cent while improving business resilience and profit; and a video project featuring Rotorua farmers providing advice about good nutrient management practice.

Low Nitrogen Land Use Fund

Co-funded by Bay of Plenty Regional Council and Ministry for the Environment.

Established to fund research that assists landowners with meeting their nitrogen discharge allowance.

Goal is to remove 140 tonnes of nitrogen entering the lake by 2032.