The Heat Is Online

NEW ZEALAND SUMMER DROUGHT COST PUT AT $500 MILLION

April 10, 1999

The costs to the farming sector of the just-ended New Zealand drought were estimated at NZ$500 million, Ministry of Agriculture (MAF) advisor Chris Ward said late last week.

The new estimate represented a NZ$200 million increase on MAF's previous estimate prepared in January.

The impact of the 1998/99 drought at the farm gate was now expected to be similar to the NZ$500 million cost of the previous summer's drought, Ward told Reuters.

"There's more of the dairy sector involved and there's more of Southland involved this year," he added.

Warm wet weather in recent weeks had now ended the drought in most areas, Ward said.

"Things have recovered remarkedly well thanks to a combination of exceptionally mild weather for this time of year and some useful rains that have been falling about every 10 days."

"They've still got a pocket of pretty dry country around Oamaru, and South Canterbury is worse off than North Canterbury, but there is a surprisingly good recovery."

This was particularly so in southern areas, while the damp warm weather had led to problems further north with facial eczema, fly strike and rye grass staggers, Ward added.

(C) Reuters Limited 1999.

RAIN BRINGS HOPE SOUTHERN NZ DROUGHT ALMOST OVER

March 10, 1999

WELLINGTON - Drought-affected areas of New Zealand's South Island recorded their first significant rainfall in 18 months on Tuesday, prompting hope among farmers that the severe dry spell may soon be over.

In the middle of the drought area, Central Otago, 12.7 millimetres of rain was recorded by MetService in a four hour period on Monday afternoon.

It was still raining in many areas on Tuesday - with some drought-affected farmers reporting more than 40mm of rain - although it was forecast to ease to showers by Wednesday.

Two consecutive summers of drought in many parts of the country cost the agricultural sector of the economy about NZ$800 million (0.4 percent of GDP), according to Ministry of Agriculture (MAF) estimates.

Some market economists doubled that cost after adding in flow-on effects to the wider New Zealand economy over two years.

New Zealand wool production was forecast to fall 3.6 percent in the current season, the Meat and Wool Economic Service said.

MAF forecast a five percent fall in dairy production to 860 million kg this season, a ten percent reduction in the apple export crop, 10-30 percent cuts in arable crop harvests and significant effects on stock slaughter weights and returns.

"The drought has been one of the most severe in history and everyone has been praying for rain," Prime Minister Jenny Shipley said in a statement. She acknowledged that the drought was not over yet.

"The latest rainfall may not be the total drought breaker, but it will definitely make a positive impact on the land and it comes at a good time," she said.

Farmers said they needed 150 mm of rain before they would declare the drought finished, but they were much happier than they had been previously.

"I must admit to a couple of very large whiskies in celebration, it was lovely just sitting in a chair and watching this hugely unusual sight," said farmer Gerry Eckhoff.

Some drought areas - in North Otago and South Canterbury - had not seen any of the much needed moisture but in Central Otago, firefighters were hopeful that the rain would put an end to scrub fires that had burned 10,000 hectares of pasture over the past week.

(C) Reuters Limited 1999.

GOVT OFFICIALS WARN NZ MAY FACE THIRD DROUGHT IN ROW

May 11, 1999

By Rodney Joyce

WELLINGTON - New Zealand's Ministry of Agriculture warned farmers on Monday that they may be in line for a third summer of drought - with associated flow on effects to the national economy.

The ministry released a summary of a climate report that said that global weather patterns that brought drought to parts of the South Island and dry weather to much of the rest of the country appeared likely to continue through winter and spring.

"Clearly farmers, particularly in Otago and Canterbury, need to consider the possibility of drought when planning their finances for 1999/2000," ministry senior policy analyst Chris Ward said in a statement.

These regions have been hit by drought for both the past two summers - the first linked to an El Nino weather pattern and the second to La Nina.

Combined with dry conditions in prime dairy areas the ministry has previously put the cost of of each of the last two dry summers at NZ$500 million ($279 million) in lost production to the farming industry.

That represents a cost of around 0.5 percent of New Zealand GDP, excluding downstream costs.

New Zealand's biggest export industry, dairying with annual sales of nearly NZ$4 billion a year, suffered a 2.6 percent fall in export production last summer to 869 million kg of milk solids which the industry blamed on the dry weather.

The climate report, commissioned from government science agency the National Institute of Water and Atmospheric Research (NIWA), said the La Nina weather pattern that had led to last summer's drought was easing, but was likely to recur.

"New information indicates that a La Nina resurgence is likely over the next six months," NIWA climate science Dr Brett Mullan.

"Over the winter central Otago is likely to get less rain than average while the North Island is likely to get average to above average rainfall," Mullan said.

He forecast above average winter temperatures in the north and below average in the south.

"During spring eastern areas of the South Island are likely to get lower than average rainfalls but most of the North Island is likely to get higher than average rainfall. Temperatures are likely to be well above average."

Both the ministry and NIWA stressed that it was still early days and a renewed La Nina may not arise or may be weak.

La Nina is a weather pattern linked to cooler than average waters in the equatorial Pacific waters off South America. El Nino is the opposite pattern based on warmer than usual ocean temperatures.

($=NZ$1.79).

(C) Reuters Limited 1999.