Now, enormous growth in Asia where urbanisation creates a "new Auckland" every week has turned that doom and gloom message on its ear.
China, he said, remained on target to double its 2010 gross domestic product (GDP) by the year 2020 and was New Zealand's hottest export market with dairy products and timber leading the way but with growth in the meat market and other products.
"The Free Trade Agreement will see the removal of practically all tariffs in exports to China and there is a big shift towards protein.
"Milk consumption has grown three-fold since 1990 to 35 billion litres a year and by 2020 this is estimated to reach 70 billion litres."
New Zealand's total yearly milk production is 17 billion litres.
Sir Graeme said that, while China remained a poultry and pork-eating nation there was now big growth in beef and lamb consumption.
He said water was the "greatest donor" to improving farming productivity in Wairarapa as in the rest of the country and as far as the project to store and distribute water here was concerned "you have me as a convert".
Project director Michael Bassett-Foss, who has been involved in regional development projects in Hawke's Bay including the Ruataniwha Water Storage Scheme, said the planned scheme would not only bring benefits to farmers but also to recreational water users and even to urban areas.
He said the "world had changed for New Zealand farmers" with the framing of the National Policy Statement for Fresh Water Management governing such things as nutrient limits and river water flows.
Farmers could "no longer put a hose in the river, or dig a bore." As water became more expensive there was a drive for greater efficiencies and less water wastage.
Mr Bassett-Foss said Wairarapa didn't have a problem with lack of water, the problem was that rain fell in the "wrong place at the wrong time".
A storage and distribution project meant water could be collected and used during droughts and dry weather periods. "Irrigation can give a surety of supply," he said.
The Wairarapa Water Use Project is a 10-year process and is now in its fourth year.
It started with 243 identified sites and was whittled down to nine by June this year.
Five further sites were added on the Upper Taueru River and the 14 sites refined to identity five as priority sites and three in reserve.
None are on major rivers described as being "no-go areas" by Mr Bassett-Foss. He told the audience the scheme itself would hold consents issued by Greater Wellington Regional Council as opposed to individual farmers who buy into it, and the earliest possible construction date would be 2018.
Benefits of a water storage facility could benefit recreational users and may even be tapped into for town water supplies.
