Farmers in the Waimate and North Otago districts are being urged to keep an eye on each other as the area becomes "critically dry".
Affected areas included Waimate, Waihaorunga and through the Hakataramea Valley and coastal North Otago, Otago Rural Support Trust co-ordinator Lindsay Purvis said.
Stock seemed to be in good order, which was often the case when drought started, and some farmers were weaning lambs at 8 weeks old, Purvis said.
There seemed to be a market from Dunedin south for store lambs, although the store beef market had "virtually collapsed".
"Drought is all about making decisions early and getting on, and looking after yourself, your family and carrying on farming as much as you can," Purvis said.