The drought in the North Island is now starting to bite off-farm, with some rural-based retailers forced to lay off staff.

A meeting of representatives from the drought regions of Northland, Waikato, Auckland and Bay of Plenty has found that farmers'  financial situations are worsening.

Committee member Norm Barker of Waikato says there seems to be a cumulative effect from the dry conditions of the past few years.

As a result, he says farmers are not spending money in their rural towns, so service firms and retailers are also struggling.

Power Farming Manager Geoff Maber says  sales have plummeted  in Northland and Waikato but he’s confident it will be business as usual next season.

Committee member Norm Barker says the drought-zone committee will give information on the situation to the Ministers of Finance and Agriculture, to alert them to the impact the drought is having on the rural community.

Meantime the Bay of Plenty Rural Support Trust is disappointed some farmers are using the drought as a money making venture, driving up supplement feed prices.

Farmers across the country are suffering in the dry conditions, and many have no choice but to buy in extra feed for stock.

Palm kernel prices are around one third higher than usual, and hay and silage bales are now $140-150 – around double the usual rate.

Trust chairman Derek Spratt says this mercenary element is quite new. However, price gouging and  feed shortages could be less of a problem in the Bay soon.

Reporoa dairy farmer Paul Gibson was one of the happy recipients of the wet stuff.

And he says it’s not too late to reap the benefits. Mr. Gibson says the long-range forecast for the Bay of Plenty is good, with plenty of showers predicted to fall in the coming week.