Mr Macdonald approved the commercial production of GM canola following advice from the NSW Expert Committee on Gene Technology.

It follows the decision by the Iemma State Government late last year to amend legislation to allow commercial production of GM crops under strict conditions.

"This is a new era of choice for the State's farmers, although strict requirements will remain in place," Mr Macdonald says.

"From today the commercial production of GM canola in NSW is legal, provided that it has been approved for commercial release by the Office of the Gene Technology Regulator (OGTR).

"This move brings us in line with Victoria and overseas countries such as Canada, which is the dominant exporter of canola, where GM canola is approved."

Mr Macdonald says the moratorium has only been lifted for GM canola and is consistent with requirements of the Gene Technology (GM Crop Moratorium) Act.