Landcorp is shipping thousands of stock across Cook Strait as the drought tightens its grip across much of the North Island.
Landcorp owns 117 farms throughout the country and has sent cattle and 30,000 - 40,000 sheep to the South Island.
Chief executive Chris Kelly said conditions in the North island are as bad as he's ever known them and Landcorp's milk production is taking a significant hit.
He said it's reasonably cost effective to ship a big truck and trailer unit full of animals south, but he feels sorry for farmers who cannot afford to send their livestock to other farms.
Landcorp has fixed term contracts which means it knows what price it's getting, but on the other hand, Mr Kelly said it means the company has formal commitments to supply finished lambs on a weekly basis to the processors.
Mr Kelly said another worry if the drought persists, is that pasture will die and have to be resown.
Landcorp expects its milk production to halve for February and March as a result of the North Island drought, with little production in April.