Good prices and weather have helped boost sheep and beef farm forecast profit to the highest in a decade.
Beef and Lamb New Zealand economic service director Rob Davison said the export lamb slaughter was estimated at 19.7 million animals and that global supply was tight overall.
The summer had been excellent for pasture growth around most of the country, which was reflected in high seasonal weights for lamb and beef, Davison said.
"Rarely do we see such good pastoral conditions and international prices at the same time," he said.
The farming organisation's mid-season update forecast average sheep and beef farm profit before tax for 2011/12 at $133,800 per farm - up 17 per cent on last year and in inflation-adjusted terms the highest since 2001/02. Gross revenue was forecast to increase at a greater rate than expenditure.
"I think the confidence will be there for the next few years and everybody's going to be a student of watching how Europe manages its way out of this recession," Davison said.
Export receipts for meat and wool products for the year ending September 30 were forecast to be $6.6 billion, similar to last year.
Lamb prices for the season were expected to average $115 per head, down 2.2 per cent on last season's record high.
Overseas prices were expected to remain at good levels, though an estimated stronger exchange rate against the euro and British pound would soften the price outlook at home, the organisation said.
"[Generally] we expect prices to remain stronger than they were a couple of years ago ... with supplies not increasing that much but the real uncertainty is just [consumer] confidence in the market in Europe, which takes half of our lamb," Davison said.