Hundreds of angry farmers from around the country converged on parliament for the first time since the 1980s to protest against the so-called flatulence tax.
The government is proposing a levy on livestock to pay for greenhouse gas research to meet Kyoto Protocol obligations.
Farmers are refusing to pay and are now back in talks with the government to try and reach a solution.
"We won't pay the fart tax no bloody way," said protestors.
Livestock produce half the country's methane gas emissions, and farmers currently contribute $800,000 to a research fund to limit it.
The so-called flatulence tax would boost that to $8.5 million, costing each farmer at least $300 a year.
Federated Farmers presented a 65,000 signature petition against the levy to parliament.
"There is research that New Zealand farmers are doing for productivity gains that if measured can also meet the government's expectations under the climate change," says president Tom Lambie.
Energy Minister Pete Hodgson said he would "characterise that an opening position in their negotiations."
"I don't think it's one that the government might find particularly compelling," he said.
A brief joint statement on Wednesday night from government, livestock industry and farmer representatives, revealed they are discussing a science plan which would meet the government's aims for greenhouse gas research and industry aims for the future of pastoral agriculture.
It says the plan would incorporate existing and proposed industry-funded research and the parties are looking forward to a positive outcome.
Federated Farmers says a solution could involve it carrying out more research into reducing flatulence.
