Live exports have made up roughly 0.2 per cent of all agriculture revenue since 2015 –
O'Connor said the Ministry for Primary Industries has been working on this since 2019.
World Animal Protection NZ executive director Simone Clarke thanked the Government for agreeing to phase out the "abhorrent" live export trade by sea.
"For more than a decade, World Animal Protection has been lobbying governments around the world to end the immoral live export trade," she said.
"The New Zealand Government's announcement to phase out live exports in the coming years is a significant moment in our history for animals, one which other governments around the world must now follow, including Australia."
Act's Primary Industries spokesman Mark Cameron said the ban was a "kick in the guts" to the rural sector.
"This ban won't improve animal welfare because live exports from New Zealand will be replaced by exports from other countries with lower animal welfare standards."
The Animal Genetics Trade Association spokesman Dave Hayman said the ban was "morally and practically unjustified".
The live animal export trade, according to the association, is worth half a billion dollars.
"This is an ill-informed, massively consequential decision for the nation, to earn short-term political brownie points from a few activists.
"There is no morality in removing half a billion dollars from our economy and forcing the early deaths of up to 150,000 animals a year."
Safe chief executive Debra Ashton said although she supports the ban, the fact that it will take two years to come into effect is problematic.
"Hundreds of thousands of cows could be exported during that time."
Last year nearly 110,000 cattle were exported from New Zealand to China - a nearly threefold increase from the year before.
O'Connor said officials had spoken to key trading partners about the decision.
"During the transition period, exporters will meet the extra requirements that we introduced following the independent Heron report, which was carried out after the tragic loss of the Gulf Livestock 1 in September 2020."
He has asked MPI to provide him with further advice on improvements to animal welfare during the phase-out period.
"I want to thank all of those who took part in the wider review. The Government is committed to high animal welfare standards," he said.
There have been no livestock exports for slaughter since 2008.
"It's a trade whose time has come, it's a trade we should have got out of years ago," former head of Animal Welfare for MPI Dr John Hellstrom told TVNZ.
