The trade balance has fallen into deficit, with exports declining for the first time in 10 months.
Official figures show a deficit of $692 million in July.
Analysts had been expecting the run of trade surpluses to end, due to the high dollar and declining commodity prices.
However, the size of the decline caught them out, with exports falling 3.3 percent to $3.7 billion last month compared with the same period a year earlier, due to a decline in log sales to China and Korea, while Australia's weaker economy hit manufactured goods sales.
Statistics New Zealand said the trend for exports appeared to be falling and it was now 7 percent below the peak in January.
Imports fell 5.4 percent to $4.4 billion, led by transport equipment, plant and machinery, and crude oil.
ANZ Bank senior economist Mark Smith said it was only a matter of time before falling commodity prices and the high dollar brought the run of trade surpluses to an end.
"Dairy prices are around 40 percent off early February levels in terms of GlobalDairyTrade auction, and the ANZ commodity price index is showing fairly broad-based falls in other parts of the commodity basket," he said.
"This will obviously come through and hit the wider export position as well."
On an annual basis, the country posted a surplus of $1.3 billion but Mr Smith said that would start narrowing.