22 Apr 2010

Northland drought cost climbs

10:59 am on 22 April 2010

A new estimate sets the cost of the drought to the economy of Northland at $300 million and climbing.

Northland Regional Council says the loss to the region from dairy farming alone, will be more than $220 million.

Chief executive Ken Paterson says meat and wool farmers are down $52 million and the losses to the horticulture industry are unknown.

He says the avocado harvest is down 20% and next year's crop will also be affected.

Mr Paterson says the only industry to benefit from the months of dry weather has been forestry, with conditions good for harvesting and forestry roads.

The Auckland Chamber of Commerce and a Bank of New Zealand economist say the drought is likely to cause city retailers to lose money.

Two thirds of New Zealand's export earnings come from the rural sector.

With rural communities tightening their belts, it's feared Gross Domestic Product will be brought down, which could then affect the dollar and petrol prices.

Auckland usage

Auckland used more water this week than last, ignoring a warning about water shortages.

Watercare said a week ago the city is using 16 million litres more water than usual, every day.

The utility says Auckland has had its driest three months in nearly 100 years and usage continues to be high.

It says there could be restrictions if the dry weather continues.