100pc in drought declared in Victoria

24 March 2007Stuff.co.nz

Federal Agriculture Minister Peter McGauran said that government drought assistance to farmers and farm-dependent small businesses in the state had increased by "an extraordinary" 83 per cent.

Victoria and New South Wales, the adjacent state, have been hardest hit by Australia's worst drought in a century, which began in 2002.

More than 90 per cent of New South Wales is still officially in drought.

Australia's weather bureau last month declared an end to the drought-triggering El Nino weather condition, and forecast a return to more normal weather. But dry conditions have continued to decimate summer crops and raise new fears about big winter crops as the wheat planting season approaches.

The government has said that the drought will cut 0.75 percentage points from Australia's GDP in 2006/07. Drought slashed Australia's last winter crop production by around 60 per cent, hitting wheat exports hard.

Australia is the second-largest wheat exporter in the world, after the United States, exporting mainly to Asia and the Middle East.