NSW Primary Industries Minister Ian Macdonald has announced the state is ending its four-year moratorium on GM canola crops, despite a last-minute plea from Western Australia and Tasmania to maintain the ban.

Mr Macdonald says the move will put NSW farmers on a level playing field with overseas farmers because GM canola now accounts for 70 per cent of the global canola market.

Victorian Premier John Brumby agrees there are great economic benefits.

"You need to be able to compete and you need to be able to maximise your yields," he told farmers.

Mr Macdonald says NSW farmers will need to get approval from authorities before they plant the crops.

"It is a cautious approach to this issue to balance the various stakeholder interests and concerns," he said.

He says GM canola crops will be segregated to protect non-GM crops, but Biological Farmers Australia director Scott Kinnear has questioned the effectiveness of that strategy, saying the wind tends to carry GM seeds into non-GM areas.

The Minister says strict labelling laws will be in place so people will know what they are eating.

He says growing GM canola will have a positive impact on the environment because it reduces the need for pesticides, but NSW Greens MP Ian Cohen is strongly opposed to the move.

"We really are moving into a new set of circumstances in agricultural production and consumption," he said. "It's going to be very difficult, if not impossible, to turn it back."

The Victorian Government decided to lift its ban after a review it commissioned concluded there would be no great health or environmental risks.

Mr Macdonald says his Government's decision was made after an inquiry chaired by former Nationals leader Ian Armstrong.

"This panel received 1,375 submissions and conducted more than 30 interviews on issues associated with the marketing and trade aspects of GM crops," he said in a statement.

"The review found that it was time for change and that farmers and markets wanted the choice.

"There is a confidence out there in the industry that it is time to move into the future on this important issue."

The Minister says South Australia is also due to make a decision on GM canola soon.

He says a limited supply of GM canola will be available in NSW for next year's planting season.