Farmers in the Galatea basin south of Whakatane are reported to be wilting under the financial pressure as drought dries up their pastures, sucks moisture out of their soil and cuts production and income.
Galatea dairy farmers were experiencing their third consecutive bad season for milk production, the Whakatane Beacon reported.
National Institute of Water and Atmospheric Research (Niwa) forecasts offer no relief, suggesting below normal rainfall for the next three months in important dairying areas such as Waikato. That has the potential to affect the economy, with at least 50 percent of Fonterra's milk supply coming from farms north of Taupo, with Waikato its key milk catchment.
Hamilton residents today had sprinkler restrictions placed on them, after the city water alert levels were raised. The change came after increasing water consumption over the past weeks and prolonged fine weather, Hamilton City Council city waters manager Tim Harty said.
Waikato milk collection was down 2% on this time last year, Northland down 5%, while overall North Island collection was about 2% down overall, as Taranaki levels held firm, the Dominion Post newspaper reported today.
Waikato farmers do not have as much supplementary feed as they did last year, but were likely to have to start feeding cows 20 days earlier than last year, consultant Ken Bartlett of advisory agency Farmwise told the newspaper.
"If it doesn't rain a bit in the next 10 days it's going to look a bit bloody ugly."
A week ago, many Northland farms were already in the grip of drought, with grasslands turning brown and little prospect of rain. Hardest hit were the Far North, the east coast and in southern sections of the Whangarei and Kaipara districts.
In the eastern Bay of Plenty Paddy Briscoe - who, with his sons, farms three Galatea properties - said anything not irrigated in Galatea was "looking pretty sick".
Whakatane Federated Farmers branch chairman Gerard Van Beek said production on the Bay of Plenty plains was down 9% in the month to early January compared with the past season. Agricultural contractor Cheryl Brogden said maize crops were starting to suffer from the dry spell, and a drought was in the making.
It had been a poor spring for making hay, haylage and silage, and crops were late being harvested. She said despite that Brogden Contractors had thousands of bales in stock ready for sale.
Mr Van Beek said pasture growth was down to 22 kilograms of dry matter a hectare: "That's a third of what's needed." Fonterra was forecasting a bumper $6.05 per kilogram of milksolids payout this season thanks to improving commodity prices, so the drought had the potential to severely restrict the economy.
Rainfall, river flows and soil moisture for January, February and March were likely to be below normal in the north and east of both islands, Niwa has said, though Taranaki was about normal. While South Island milk collection was likely to be up about 3%, strict water controls were being introduced in parts of Otago due to continuing dry weather.
Otago Regional Council said it would be encouraging irrigators to manage what water was still available.
Otago has been dry since November, with the Shag River below its minimum flow, the Kakanui River at very low levels and the Waianakarua and Taieri rivers also affected.
Federated Farmers Don Nicholson president has suggested the Government look hard at improving the country's water storage.
"Given the tens of millions of dollars of time and money spent on developing the emissions trading scheme and other policies, it seems lunacy that we are not putting that same level of commitment into water storage.
"The simple truth is that water pays the bills and while New Zealand does not lack for annual rainfall, we chronically lack the means to store it.
"Summer should be the season of maximum agricultural output but pasture and crops need water as well as sunshine hours and soil temperature to flourish."