The country's biggest farming enterprise, Landcorp, says the summer drought cost it $11 million in lost production and other expenses.
The state-owned farming enterprise released its financial results in Wellington on Wednesday night.
Chief financial officer Richard Perry outlined the impact of the record-breaking drought on its operations.
He says it had to sell over 70,000 lambs on the store market and also 14,000 cattle store which normally would have been taken through to fatten in the current season.
"So it's had an impact last year which has flowed through into this year, but very much the mandate was to isolate the impact and have one bad drought - not the experience of 2008 where it lingered on and hurt us for a couple more years. "
The drought also reduced Landcorp's milk production by a million kilos of milk solids.
Despite that, it was able to take advantage of its geographical spread to end up with a net operating profit of $13 million and it paid the Government a dividend of $5 million.
Landcorp's new chief executive, Steven Carden, says it's expecting a better result this year which a warm spring producing plenty of feed and milk prices running hot.
Mr Carden says dairy farming will be contributing about 60% of Landcorp's revenue in five years.
It's aiming to double milk production within three years, mainly from the 16 former Crafar farms it's now managing on behalf of Shanghai Pengxin, and large scale dairy conversions underway on former forestry land at Wairakei in the central North Island.
Sale not on agenda
Meanwhile, Landcorp says there's been no indication that the Government is planning to put its farming operation up for sale as part of its asset sales programme.
The latest call to sell off Landcorp has come from the Act Party, which says its $5 million dividend to the Government is far too low and there's no justification for the state to keep owning the country's largest farming enterprise.
But chairman, Bill Baylis said that a sale of Landcorp is not on the horizon and it's clearly not part of the current programme of partial sales of state-owned enterprises such as power companies.
Primary Industries Minister Nathan Guy acknowledged the importance of Landcorp to the agriculture sector and the economy when he spoke at the results release on Wednesday night .
Mr Guy says Landcorp is also making a significant contribution to agricultural research and technology transfer and farm safety programmes.