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A South Otago grain farmer says conditions are the driest he has ever seen in December and grain farmers in the region are starting to feel the bite.
Waiwera South farmer Craig Whiteside, who has about 300ha in barley, wheat and oat crops, said the 10 to 15 grain farmers in South Otago were facing significantly reduced yields on their spring-sown crops.
"I would say at this stage we are looking at 30% reduction in yields [in spring crops] and if we don't get rain it will just continue dropping." He said it was the driest December since his father bought the farm in 1976.
"It's bad because it's so early. We've been this dry in March, but we've never been this dry this early," he said.
Autumn-sown crops were not as badly affected by the dry weather.
Mr Whiteside said his farm was lucky two-thirds of its crops were sown in autumn.
Some farmers in the region would have a higher proportion of spring-sown crops and would be worse off because of the dry weather, he said.
Bill Clouston, who farms grain near Omakau, said the dry conditions were not affecting his crops because they were irrigated.
However, it was dry in areas which were not, he said.
Stuart Hammer, the chief executive of Dunedin cereal manufacturer Harraway and Sons, said the dry conditions were yet to become a significant problem for the company, which sources oats from Otago and Southland.
"If there's rain within the next four or five days we should be OK," Mr Hammer said.
If conditions stayed dry, the company had the "opportunity of potentially [increasing] autumn sowing this year, to harvest earlier, to compensate for any potential yield loss".