Alliance Group's Lorneville plant, just outside Invercargill, had nine halal butchers on-site but needed six more.
General manager manufacturing Willie Wiese did not directly address the report's concerns but said halal butchers provided the company with the "real flexibility" to match cuts to the needs of customers in the global markets and help lift the overall value of each carcass.
Across New Zealand's red meat processing and exporting sector, halal-certified products contributed about $3.7 billion of annual export earnings.
"Which delivers strong returns for our farmers, rural communities and the economy," he said.
The report also found labour shortages in the primary sector were having a "detrimental effect" on employers and employee wellbeing in Southland, especially now with another Covid-19 outbreak.
The report said due to the continued inability to attract permanent on-farm staff, the rural sector was relying on contractors who were also having problems attracting and retaining staff.
Self-isolation requirements would also put pressure on labour for farmers and transport companies that were already stretched.
Federated Farmers Southland president Chris Dillon agreed with the report, saying it had the potential to be a "huge problem".
One advantage the sector had was that workers lived on the farm so would already be isolated.
If too many people caught the virus, it would bring the sector and the wider economy to a halt.
Federated Farmers, working with farmers around planning for Covid-19, had created a planning template they could use. Dillon encouraged its use and having a plan in place.
Another challenge facing Southland's labour sector was short staffing in tourism and health.
There was concern about the health sector being able to deliver services safely.
The Government's plan to reopen New Zealand's borders throughout this year would provide an opportunity for the labour market, the report said.
The report also found the number of job seeker benefit recipients in Southland was down 11 per cent in December compared to the figures from 12 months earlier.