Economists say exports are likely to be subdued in coming months as drought conditions curb dairy production and contract prices fail to capture higher auction prices in the last month.
Official figures shows exports fell nine percent to $3.7 billion due to lower prices for dairy, particularly milk powder. Imports fell four percent to $3.6 billion, led by lower crude oil prices.
On an annual basis, the deficit stood at $1.4 billion.
Westpac senior economist Michael Gordon said New Zealand's trade position was holding up pretty well compared with Australia.
He said the combination of lower dairy prices versus cheaper imports, from lower oil prices, meant the balance for New Zealand's terms of trade was "pretty close to bottoming out".
In Australia, however, the picture was very different.
"Australia's really struggled with falling prices for their big import, which is iron ore. Those prices are still pretty soft and there hasn't really been a turnaround," he said.
"It's just one more factor adding to the picture of the kiwi economy really out-performing our neighbours across the Tasman at the moment."