The upgrade of the "antiquated" yards will move ahead after NSW Deputy Premier John Barilaro announced on Tuesday that the state government would stump up $14 million for the project.

Gunnedah Shire Council, which owns the facility, will contribute the remaining $3.55 million to get the job done.

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A small crowd turned out for the announcement, which was a breath of fresh air after months of COVID-19 restrictions and two years of discussions over a master plan, which was endorsed almost 12 months ago.

Gunnedah shire mayor Jamie Chaffey said "in a good year" about 120,000 head of cattle go through the saleyards annually, which equates to $100 million in sales.

The saleyards is the fourth largest selling centre in the state and the eighth largest in Australia and Cr Chaffey said the redevelopment could only improve its viability.

"We know by upgrading this facility that we can see will not only cement that but we believe that we will actually go further up the chain in being recognised as a beef selling facility," he said.

"It plays really well into the regional plan we have through Namoi Unlimited.

"We know protein is one of our strongest enablers ... we know how important the saleyards upgrade is to those aspirations of growing those job opportunities and wealth within our region."

Mr Barilaro said he believed agriculture could lead the way in rebooting the economy after COVID.

"It's going to be an agricultural-led, a regional-led recovery from COVID and as the drought hopefully continues to break, it will mean we've got the ability to do so," he said.

"If there's ever been time in history that we reinvest back in infrastructure and agriculture, now is the time.

"We'll get this up and running, set you up not just for today but for the future, and send a clear message that regional NSW, especially Gunnedah, will be at forefront of agricultural revival that will reboot the economy and hopefully, in years to come, generate more interest from young people to stay in town and in the region."

Tamworth MP Kevin Anderson said there was "skin in the game to make this work".

"This is what needs to happen in Gunnedah," he said.

Mr Anderson said the second rail-over road bridge under construction would only serve to better connect the saleyards to vendors.

The saleyards master plan includes a state-of-the-art office, cafe and education centre, biosecurity improvements, new technology, security fencing and infrastructure upgrades.

The project will include the removal of the sheepyards, yard expansion, technology upgrades, and relocation of the car park and canteen as part of a multi-use building on the same side as the saleyards.