Plunging global dairy prices have led to Fonterra dropping its forecast milk price for 2014-15 to $5.30 - the 70c drop from its previous $6 forecast alone meaning a loss of income to Otago dairy farmers of about $56.1 million.
But feedback from farmers at the moment had been ''reasonably accepting'' of the situation, Mr Heer said.
''I would say, on average, farmers are just very considered about it,'' he said.
It had been well signalled and it was good it had come early in the season so there was an ability to manage expenses.
The way the dairy payment system worked, with deferred payments, meant that cash position ''should still be OK at this stage'', he said.
But there was also an awareness heading into next winter and this time next year that, unless things improved after Christmas, it would become ''more of a crunch time'' from a cashflow point of view.
There was some nervousness around how the season would play out, Mr Heer said.
Until about six weeks ago, when there had been a big fall in GlobalDairy Trade prices, there was not a lot of volume coming through the vats.
Now, coming into the peak production period, the fact there were still price falls became a ''bit more relevant'' and increased anxiety levels, The longer it went into the season, and if prices continued to fall, there was a stronger likelihood of a substantially lower payout.
Asked what the bank was doing to support its farming clients, Mr Heer said it was ''definitely out in the field'' and talking to customers as much as possible.
Each farmer's situation was different and could require a slightly different approach.
The key message was for farmers to get in contact if they had any concerns, he said.
There were options around making sure farming operations had adequate working capital.
In the 2008-09 season, average debt per kilogram of milk solids was $20.81 and, at the end of the 2013-14 season, it was $18.90, with production going up at a faster rate.
ASB maintained the view that the medium to long-term outlook for dairy was very positive.
As was seen through the global financial crisis, key global trends had not changed - an increasing population, increasing wealth, particularly in Asia, and an increase in people consuming protein within their diet. A ''blip in the market'' did not change those dynamics, Mr Heer said.
There were always going to be supply responses; global supply would increase when commodity prices were pushed up to record levels.
As global demand increased, there were going to be those typical cycles washing through.
In the red meat sector, there was plenty of positive feedback from farmers around beef prices at the moment, he said.
ASB believed it would take 12 to 18 months for the United States beef herd to increase, which has driven the lift in prices, so the favourable beef market was expected to continue for another year or two, as the US rebuilt from a low.
Supply-demand factors around sheep meat looked positive as well.
An uplift in beef and lamb prices would really give some confidence to the sheep and beef sector, which had been tested, he said.
In March last year ASB launched its environmental compliance loans. Since then it had funded just over 400 on-farm projects, totalling about $45 million of lending.
The average project cost had been from $105,000 to $110,000 and they ranged from upgrading effluent management systems to fencing waterways and building bridges.
It was about farming in the changing environment and Mr Heer said he had ''total confidence'' the rural community would move with that and adapt.
Farmers, by nature, were environmentalists and most had a view to passing the farm on to the next generation. That meant they always had a view to environmental consequences, he said.
