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Hororata Community Trust chairman Richard Lang said it has made the "difficult decision" to cancel the 11th annual games, which were due to take place on November 6.
"The Hororata Highland Games is a significant outdoor event attracting around 10,000 people annually, and can only operate in alert level 1," said Lang.
"It is not a decision we take lightly, but our community has been through a lot recently with floods, wind and snow, and given the current uncertainty with Covid alert levels we have needed to make a firm decision now to cancel the games.
"The trust, first and foremost, is here for the well-being of our community and in uncertain times we need to give certainty," Lang said.
"We were lucky to be able to run the games in 2020, however, this year is different.
"This year our community has had many other challenges. Delta is a very different proposition, and as people come from all over New Zealand for our festival the whole country would need to be at level 1 for the trust to feel confident that it was safe to run the games.
"We know that people will be disappointed but we hope they will understand and support our community with this decision."
Ticket-holders can also donate the cost of their tickets to the Hororata Community Trust and in return will be offered a 50 per cent discount off tickets for the next Hororata Highland Games.
Any donations will go towards the work the trust does to support its rural community. Competitors and stallholders will also be refunded.
"The support of our sponsors and patrons has again been steadfast," Lang said.
"We thank them for being willing to support our community to hold the games but equally for their support with the decision to cancel."
"The most important thing to the trust is our community. Together we have faced many challenges and through them all, by focusing on our people we have remained a strong and resilient community.
"The trust is committed to the Hororata Highland Games and looks forward to bringing this festival back in 2022."