The Government has reversed its ban on kosher killing of poultry but arguments continue about beef and sheep.
Agriculture Minister David Carter in May ruled that all commercially killed animals must be stunned before slaughter to "ensure that the animals are treated humanely", which effectively outlawed kosher killing which is called shechita.
"I was concerned about animal welfare issues with regard to shechita kill. I think it is a cruel practice particularly with beef and sheep," Mr Carter told NZPA.
The Jewish community took the issue to court and the case was due to be heard on Monday but, after months of negotiations with Crown law an agreement was reached on Friday to allow chickens to be killed -- about 5000 a year but this could be extended through talks.
"We continue to talk about sheep and beef and if we can't resolve that satisfactorily they would take it back to court," Mr Carter said.
"They cannot get fresh chicken from Australia... they can and do import sheep and beef from Australia currently."
More than half New Zealand's sheep are killed by halal slaughtermen for the Islamic market, by cutting the throats of electrically stunned animals.
But shechita slaughter requires arteries and jugular veins to be cut using a sharp blade to allow the blood to drain out. The animal cannot be stunned or unconscious. Sheep, goats and poultry are likely to feel pain for between five and 22 seconds before blood loss causes unconsciousness, and welfare experts say cattle could suffer for a minute or more.
A statement from the heads of the Auckland Hebrew Congregation, the Wellington Jewish Community Centre and the New Zealand Jewish Council thanked the Jewish community in New Zealand and overseas for its support and donations toward legal costs.
"Unfortunately there is still a significant shortfall, and community members are asked to 'dig deep' to help meet the costs of our campaign to save shechita in New Zealand,' they said.
A newspaper report today accused Mr Carter of considering trade implications when he banned shechita -- such factors are not allowed to be a factor in animal welfare decisions.
That was "rubbish", he said, as was any inference he was trying to advantage his own business interests.
Mr Carter confirmed he had a March meeting with Silver Fern Farms in which he is a shareholder.
"When I met with Silver Fern farms or met with any of the meat industry they've pointed out there are trade implications if we make an exception for the Jewish community but whilst I was aware of those trade implications at all times I only made my decision based on welfare."
The meeting with Silver Fern lasted about half an hour and the issue was fleetingly raised.
"It was mentioned but only in passing."
Mr Carter said he had two properties, and had shares in a number of cooperatives including fertiliser, meat and farm merchandise.