The price on world markets for New Zealand's commodity exports posted its biggest monthly fall in 21 years in September.
The ANZ commodity price index was dragged down by a 7.9% slump in dairy commodities, which account for a third of the basket of mainly agricultural commodities monitored by the bank.
An economist at the bank says faltering demand accounted for the collapse in prices.
At the same time, smaller dairy-producing countries increased production in response to high prices last year.
The fall in September follows a 7.5% fall in dairy prices in August and falling prices generally since November 2007.
At Wednesday's weekly wool auction, prices for cross-bred wool fell by up to 3% following strong prices at recent auctions, with sellers passing in more than 40% after failing to meet reserve prices.
