China remained New Zealand's largest trading partner and has now held this position since 2013.
Westpac senior economist Michael Gordon said the main surprise was a surge in exports to a record high, led by a jump in dairy export volumes, but he cautioned the gains were likely to be shortlived.
''The [export] rise was led by a 12% jump in dairy export volumes, a rise that is unlikely to be sustained as dry weather means that the volume of milk available to be exported will be down on last season,'' Mr Gordon said.
He said in seasonally adjusted terms, imports were down 4.5%, highlighting that in the previous two months, import trade was boosted by importation of two Boeing Dreamliner aircraft, each worth about $260million.
However, imports of capital equipment remained strong, which was a positive signal of businesses' willingness to to invest, he said.
Exports of milk powder, butter and cheese lifted total exports to a record $5.6billion in December 2017, Statistics NZ international statistics manager Tehseen Islam said.
''Monthly exports were $1.1billion higher than in December 2016,'' he said.
Record export values of dairy products drove total exports to their highest monthly value; the previous highest values for both dairy exports and total exports were recorded in the 2013-14 dairy export season, when dairy prices were at a high level, Mr Islam said.
The monthly trade balance in December 2017 was $640 million, or 12% of exports, the largest for December and the largest in any month since March 2015, of $661 million.
The annual trade deficit narrowed to $2.8 billion from $3.1 billion.
China, Asia's largest economy, took over from Australia as New Zealand's top trading partner in 2013 and has retained this position since then, BusinessDesk reported.
New Zealand exports to China surged 27% to $12 billion in 2017, accounting for 22% of the country's total exports, while imports from China rose 5.7% to $10.9 billion, accounting for 19% of New Zealand's total imports.
''China overtook Australia as our top export market in 2013 and has remained at the top every calendar year since,'' Mr Islam said.
''The gap between the top two markets is now wider than it's been at any time since then.''
Goods exports to Australia lifted 6.5% to $8.8 billion while imports from Australia also gained 6.5%, to $6.9 billion.
