A vet and other staff were urgently flown over from New Zealand. About 850 of the ewes were alive, the Government previously said.
Mr Guy told reporters the deaths were disappointing and would be taken into account when future animal exports were considered.
The sheep were not on pasture but under some shelter, he said. Asked how so many lambs could die if there was shelter, Mr Guy said: "There is a lot of sand and the wind can get up and that caused, as I understand it, some mortality."
Revelations of the lamb deaths put more pressure on National over the deal, in which more than $11 million of taxpayer money was spent.
Labour's trade spokesman, David Parker, issued a press release yesterday entitled Operation Desert Storm, in which he said the so-called model farm was an embarrassment.
"National is sullying our international reputation for fair dealing, animal welfare and agricultural excellence."
Trade Minister Tim Groser defended Mr Guy's sandstorm comments in Parliament, saying such detail was operational and it was not the minister's job to "hot foot it up to a Saudi farm" to find out that type of information.