Drought spreads south – Grey and Buller declared dry

The list of regions officially experiencing drought grows.

Primary Industries Minister Nathan Guy has added Buller and Grey districts on the West Coast of the South Island to the growing list of regions officially experiencing drought.

They join the entire North Island as being in drought, granting local farmers access to special government funding to alleviate any extreme hardship. The dry conditions are the worst seen in almost seven decades in the North Island, and may cost the economy as much as $2 billion in lost production.

"The rain over the last week has not been enough to help these districts, and there is only limited rain forecast for the next two weeks," Mr Guy says in a statement. "It is very unusual for the West Coast to experience drought conditions and is not something that local farmers are used to. It shows just how extreme this dry period has been."

The drought is expected to reduce New Zealand's dairy production this season and has seen dairy products sold at Fonterra's online auction dwindle to a two-year low.

Mr Guy says Work and Income will offer rural assistance payments, which is the equivalent of the unemployment benefit, to people in extreme hardship.

(BusinessDesk)