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Canterbury residents are being told to prepare for water restrictions as aquifers reach their lowest levels since the 1980s.

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In Environment Canterbury's drought update, more than 86 percent of the wells they've monitored show a low or very low groundwater level, and South and North Canterbury look once again to be hit the hardest.

Unless significant rainfall replenishes groundwater levels, urban as well as rural areas are likely to face water restrictions.

Federated Farmers North Canterbury president Lynda Murchison said farmers who rely on irrigation may need to look at alternatives for their land use.

"Reducing your stocking rates if you are on a stocking rate that you can't sustain without irrigation, some farmers might think about what they plant and the value of the crops that they plant."

Ms Murchison said if there's restrictions, they may need to look into budgeting their water use as well as looking at water share groups.

She said things will be different now going into a third season of drought.

"This now comes down to basically how much debt you're carrying on a farm, how much off-farm income you've got, and therefore how long you can operate your business at a loss basically before the bank manager wants to have a chat."

Ms Murchison said it was good to get the update early, as it at least gives farmers time to prepare.