Nielsen research showed the value of the water category at supermarkets and petrol stations was $60.4 million last year. That figure does not include dairy sales.
The figure was down 5.8 per cent on 2011, but bottled water sales were up 25.7 per cent for the first quarter of this year. Nielsen said this showed weather had a major impact on water sales.
"Therefore, it is fair to say 2012 wasn't such a good year for water because of the poor summer but the strong summer this year has put water back in positive value growth."
The New Zealand water industry is dominated by two companies - Coca-Cola Amatil, which owns brands like Pump and Kiwi Blue and sources its water from the Blue Spring in Putaruru, and Frucor, which does not reveal its source but owns H2Go.
Rob Bree, a marketing strategy consultant who has worked extensively in the food and beverage industry, said that since the 1990s there had been extraordinary growth in bottled water sales. Explanations include the launch of the sipper bottle, concerns about chlorination and fluoridation, globalisation, a boom in the fitness industry and people leading generally healthier lifestyles.
"There's a convenience to it ... People don't generally tend to plan ahead, unless you have children. You don't often take a bottle of water around with you so end up just buying it from a dairy."
Mr Bree said that if people were thirsty, they'd buy water over a sugary drink because it was healthier.
A 2002 international study of 122 countries found the quality of New Zealand water was the third-best in the world.
But University of Canterbury toxicology professor Ian Shaw said that in his opinion there were no health benefits in drinking bottled water over tap.
In fact, the chemicals that leaked into bottled water from the plastic could be damaging.
Professor Shaw said the problem with studies on the effects of chemicals in plastic was that they did not look at the impact of the tiny amount that leached into the liquid combined with other enzymes people consumed from other plastics, such as cling film or containers.
"Why on Earth buy water when there's perfectly good stuff coming out of the tap?"
Much debate has surrounded the concern about Bisphenol-A or BPA in the manufacture of polycarbonate plastic drink bottles and packaging and in the lacquer that lines food and drink cans.
Tiny amounts of BPA end up in humans and tests have consistently found the chemical in blood, urine, umbilical-cord blood and in the amniotic fluid protecting a fetus.
The New Zealand Food Standards Authority says BPA is safe as long as no one exceeds the "Tolerable Daily Intake" level of 0.05mg per kilogram of bodyweight per day.
Professor Shaw says the thin and flexible plastic used to make most single-use water bottles doesn't contain BPA, but the hard plastic lids do.
"The marketing around it is excellent. People think that they're getting something that's really good for them, but it's just water."
A master's thesis by former Massey University student Ruta Svagzdiene examined the debate on whether bottled water was safe from a microbiological point of view.
The 2010 study found three out of 39 brands tested did not comply with the New Zealand Microbiological Reference Criteria for Food and the Australia and New Zealand Food Standards Code.
Ms Svagzdiene said the public perception was that bottled water was safer than municipal water. "This master's research study demonstrated that New Zealanders should not assume that all batches of bottled water brands sold in New Zealand is of a satisfactory drinking water standard," she said in her conclusion.
New Zealand's standards and practices for monitoring the microbiological quality of mineral water needed to be revised.
The New Zealand Juice and Beverage Association executive director, Kerry Tyack, said it wasn't a matter of "tap versus bottle", as bottled water had its benefits.
"There's many reasons why people might purchase a bottle of water - they might be travelling in a car and it's convenient, to buy a bottle and use it later."
Bottled water also often tasted better than municipal water.
In a New Zealand Herald blind taste test, food writers and chefs Nici Wickes and Nadia Lim could tell which cup had tap water in it. Both said the flavour of tap water varied around the country and rated Christchurch's water as the best.
"It's honestly just as good as bottled water - I don't know why you would buy water in Christchurch," said Ms Lim.
Mr Tyack said beverage companies were working to find ways of making their packaging more sustainable and that the industry urged people to recycle their bottles.
Over three years, 31,130 plastic bottles were picked up from the country's beaches, said Sam Judd, chief executive of the Sustainable Coastlines Charitable Trust.
"[A water bottle] is an item you don't really need - it's an unnecessary product."
Mr Judd urged people to buy a reusable bottle.
Two Californian scientists estimated in 2008 that just producing the plastic bottles for bottled-water consumption worldwide used 50 million barrels of oil annually - enough to supply total United States oil demand for 2.5 days.
Some companies are now using PLA plastic bottles that are completely biodegradable.
A 2009 study by Dr Steve Bowden and Dr Eva Collins of the University of Waikato Management School and Dr Kate Kearins and Dr Helen Tregidga of Auckland University found not enough of the PLA plastic was used in New Zealand at the time and it was not seen as economic to separate and recycle.
- Amelia Wade of the New Zealand Herald
