New Zealand has officially declared its most widespread drought in at least 30 years.

The government said the entire North Island was a drought zone after adding several more regions to those already designated as suffering.

The official designation provides farmers some financial relief through increased government funding of rural groups and tax breaks. Farmers facing serious financial hardship will also be eligible to apply for temporary unemployment benefits.

The drought has forced dairy farmers to reduce their herds in a country which relies on the industry for export earnings. Farmers estimate the drought has so far cost them about one billion New Zealand dollars (€630m).

Parts of the North Island are drier than they have been in 70 years and some scientists say the unusual weather could be a harbinger of climate change. There has been little significant rainfall in the northern and eastern parts of the country since October.

Dairy farmer John Rose has sent more than 100 of his cows to the slaughterhouse over recent weeks. He has had to thin his herd so the remaining 550 cows have enough to eat and is supplementing their diet with ground palm kernel as the grass in his fields withers.

“We try and make sure they’ve got water and shade during the day and do the best we can for them,” he said. “It’s very hard to remember when the last rainfall was.”

Still, some are finding the dry, sun soaked days a boon. Vintners call the conditions perfect. And city dwellers are revelling in eating lunch outdoors or spending evenings at the beach in a Southern Hemisphere summer that never seems to end.

Farming, and dairy cows in particular, drives the economy in the island nation of 4.5 million and the drought is expected to shave about a percentage point off economic growth.

New Zealand’s last significant drought was five years ago and also cost farmers billions.

Bruce Wills, president of farming association Federated Farmers, said North Island slaughterhouses were processing about 40% more cows and sheep this year as farmers reduced their herds. The increased numbers and lighter weight of the animals had resulted in plummeting prices, he said.

North Island farmers are also sending stock to the South Island, which has not been so affected.

“One of the challenges with a drought is that the impact can go on for a number of years,” Mr Wills said. “We’ll have a lower lambing percentage next year because there hasn’t been enough feed this year.”

“It’s a very serious problem,” said politician David Shearer. “It’s obviously affecting farmers, but the other part is it’s also going to flow through to our rural communities – the retail shops and the businesses.”

Bill English, the country’s finance minister, said that despite the economic difficulties caused by the drought, he believed the government could still maintain its goal of returning the national budget to surplus by the year beginning July 2014. The country was sent into the red after the 2008 global financial crisis.

James Renwick, a climate scientist at Victoria University of Wellington, said New Zealanders should expect more summers like the current one due to global warming.

He said the dry sub-tropical weather that helps forms deserts in places like Africa and Australia was expanding towards the world’s poles.

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