The country is facing a drought if desperately needed rain doesn't fall in the next month, Niwa warns.
Soil-moisture levels across the country are lower than average for this time of year and irrigation restrictions are already in place in parts of Canterbury and North Otago.
Niwa principal climate scientist Dr Andrew Tait said the situation was a cause for concern.
"Potentially, if there is no significant rainfall for the next month or so, we could be heading into one of the worst nationwide droughts we've seen for some time."
DairyNZ spokesman Craig McBeth said Canterbury, North Otago and South Wairarapa were facing extremely dry conditions and the rest of the country was facing drier-than-average soil-moisture levels.
Rain was needed soon to reduce the risk of a normal dry summer becoming more serious, he said.
WeatherWatch spokesman Philip Duncan said rain was forecast to move up the West Coast this weekend, potentially brushing Canterbury and giving farmers some much-needed rain. But there was no respite for Wairarapa, aside from a few showers forecast.
"At the moment, there are rainmakers all around New Zealand, but just not over us.
"The West Coast is the only region that WeatherWatch is predicting to have average rainfall for the rest of this month - everywhere else we think it will be below average.
"There's a couple of shots of rain at the end of the month, but if we miss that, it'll probably be another two weeks after that [until we get rain]."
Farmers were right to be concerned, Mr Duncan said.
The dry conditions have caused fire danger levels across the country to rocket to extreme levels.
In the Bay of Plenty fire danger level has reached extreme, prompting suspension of all new fire permits.
Gisborne principal rural fire officer Richard Steele says most parts of the district have had only a few millimetres of rain in January and some areas have had none.
A restricted fire season is in place and it is only a matter of time before a total ban, he says.
Otago has a total fire ban, with recent rain not reducing danger levels.