NZ Merino has signed a five-year, $45 million deal to supply fine wool to Italian luxury fabric manufacturer Successori Reda.

Wool prices rose at the first auction following the Christmas and New Year holiday period, helped by the lower New Zealand dollar.

The prices eased in the first sale of the new 2015/16 season as demand weakened.

MPI forecasts revenue from primary industries will drop to $35.2 billion in the year to June.

New Zealand's smallest annual wool clip in six years reflects the lowest sheep flock in more than 70 years.

Wool auction volumes are set to increase next week as farmers who have been holding out put their bales on the market.

Sheep meat prices have fallen by about 10 per cent over the past two months, driven by a drop in demand in China and difficult conditions in another important export market - Britain.

The risk of the kiwi dollar remaining high is the biggest risk to Government forecasts for growth in the nation's farm, forestry and seafood exports, a new Government report says.

A fall in global commodity prices and the strong kiwi dollar meant New Zealand producers were squeezed in the first quarter.

A hanging meadow planted in wool may be adapted to create more affordable "green walls" for the rebuilding of Christchurch.

New Zealand commodity prices were stable last month, with weakness in logs and dairy products, while kiwifruit prices rose, according to the latest ANZ Commodity Price Index.

A Treasury forecast of a plunging kiwi dollar should mean a surge in the New Zealand primary sector, says a new MAF report.

An Auckland firm has rolled out an ingenious use for the byproducts of an unlikely combo - sheep and coffee.

New Zealand commodity prices edged up to a new record in May, led by kiwifruit at the start of a new season. Prices in New Zealand dollars fell from a record level as the kiwi dollar climbed.