The open pit contains hundreds of bodies of cows and calves, some of which had had their throats cut.
It appears the carcasses have been thrown down a bank and left to decay. They were not buried. Rats can be seen running over the rotting bodies.
Safe spokesman Hans Kriek said after receiving serious animal welfare complaints from farm workers, MPI should have examined the pit to determine if any of the animals had been violently abused.
"If MPI had made the effort to walk around the property they would have found the bodies and been able to examine them for injuries."
Last week, head of compliance Gary Orr said that MPI was unable to place hidden cameras on farms to gather evidence because the longest sentence for animal cruelty convictions was five years, rather than the seven years needed to use undercover surveillance.
But Kriek said: "If current law doesn't allow the use of hidden cameras, MPI could at least take a vet to examine the animals, interview the farm owner and workers, and examine animals dumped in the farm's offal pit."
He said in addition to serious questions over how and why the animals died, the bodies were within metres of a stream, posing a danger of environmental contamination.
Safe believes MPI did not examine the pit when it visited the property this year after allegations of animal abuse.
Regional Council rules for disposing of dead animals state animals must be buried at least 50m from any watercourse, water supply bore or home.
The burial site must also be adequately covered to prevent nuisance smells and vermin.
Use of a gully as an uncovered disposal site was not an option and neither was burning dead animals.
MPI guidelines for dairy farms offal pits include not siting a hole containing decaying matter closer than 45m from milking, milk receiving and milk storage areas, tanker loop or water supply.
Offal holes must be adequately covered to reduce odour and insect infestation and to prevent scavenging by animals.
MPI said care should be taken on the location of offal holes, as leaching could contaminate the underground water supply.