Opponents of a Wairarapa irrigation scheme are continuing to speak out in the wake of last week's $804,000 grant from the Government.

In Carterton last week, at a 2016 Farming for the Future seminar, economist Peter Fraser called the latest dairy forecast an "enormous off-ramp" for the dam proposal.

The conference on Tuesday coincided with Fonterra's announcement of a further downgrade to the forecast farm gate milk price for the 2015/16 season to $3.90 per kg of milk solids.

"Given I labelled WWUP's [Wairarapa Water Use Project] proposals 'dud dams' when the milk price assumption was well above six dollars, I don't think a milk price below four dollars is going to make them any better."


Mr Fraser predicts a farmgate milk price in future of $5 plus or minus $1 -- "not the $6.60 plus or minus $1.80 seen between 2007 and 2014".

Mr Fraser claimed excessive debt and irrigation had "fragilised" farming systems, leaving many dairy farmers and share milkers with high cost structures and exposed to the risk of lower milk prices.

He agreed with the comment of one farmer that because Wairarapa has a comparatively small dairy sector, the region should escape the worst fallout from the price plunge.

"I think Wairarapa has dodged a bullet."

Wellington Fish and Game Government grant ignites irrigation controversy

manager Phil Teal weighed in with more opposition in a story which appeared in Saturday's Wairarapa Times-Age, saying the Wairarapa Water Use Project is "supposed to be conducting a feasibility exercise" -- not advocating for the project to go ahead.

Forest & Bird's Wairarapa conservation manager Amelia Geary slammed the Government's "plans to subsidise a large water storage scheme with $804,000 of public money" -- citing water quality and economic concerns.

"Wairarapa already has significant environmental problems from current land use practices.

"Lake Wairarapa is classed as 'supertrophic' and is one of the most polluted shallow coastal lakes in New Zealand," Ms Geary said.

"The Ruamahanga River also suffers significant faecal contamination from agricultural and urban areas."

Ms Geary said work with landowners to improve water quality around Lake Wairarapa "could be undone by plans to further intensify land use in the upper catchment".

Ms Geary said intensive dairy operations are suffering most with low milk solid prices "so it's hard to understand why the Government is prepared to spend so much taxpayer money to encourage more of these struggling operations".

"The case for flooding significant areas of QEII covenanted land, on behalf of an industry that's undergoing a major crisis, is questionable to say the least. However the dam project may progress, Forest & Bird is determined to see the region's environmental standards maintained and improved."

Labour's water spokesman David Parker said the Government needs to consider whether projects like Wairarapa are a waste of money, especially in the light of falling dairy prices.

"The Wairarapa projects have all the hallmarks of another white elephant. Four million dollars of ratepayers money has already been spent on the planned dams with little to show for it," Mr Parker said.

Mr Parker said a crash in dairy prices highlighted concerns over economic viability of water schemes.

He claimed that "unwise subsidies of irrigation projects have pushed many farmers into bad investments", and that farmers with high-cost systems are going broke.

"More intensive farming is also the main cause of our rivers getting dirtier," Mr Parker said.