Orientation selectivity is a key feature of primary visual cortex (V1). Orientation specific receptive fields (OSRFs) appear to arise from specific feedforward connectivity from lateral geniculate nucleus (LGN) to V1 cells. OSRF development has been hypothesized to arise from a competition between ON- and OFF-center LGN cells, if the difference between same-type and opposite-type correlation functions is a non-monotonic, "Mexican hat" function of cell-cell separation. However experiments found this difference decays monotonically. Many models have assumed "Mexican hat" recurrent connectivity (local excitation & lateral inhibition) to develop spatial variation of preferred orientation, but experiments suggest that excitatory projections are longer range than inhibitory. We have found analytically that OSRFs will develop with a monotonic fall-off of both the correlation difference and intracortical connectivity, provided one or both are sufficiently long-range and homeostatic competition ensures the summed projection strength of each thalamic neuron is conserved. Implementing this in a network model of excitatory and inhibitory cells with plasticity driven by trial-by-trial activities, and a biologically plausible implementation of homeostatic normalisation of the feedforward weights, we find a robust development of OSRFs. Recent experimental work showed that, within a local cortical region, RFs are anchored by (centered on) subfields of a single type (ON or OFF). We can reproduce this observation by increasing the variance of the anchoring input type. Furthermore the RFs generated in this way tend to match several experimentally measured RF properties. We conclude that monotonically decaying input correlations together with a competition-based Hebbian plasticity rule and a cortical network layer without recurrent lateral inhibition is sufficient to lead to the emergence of OSRFs with experimentally realistic properties.