Many face the prospect of abandoning their homes altogether - some after being on the land for generations.
Australia's most populous state was declared entirely in drought on Wednesday and struggling farmers were given new authority to shoot kangaroos that compete with livestock for sparse pasture during the most intense dry spell in more than 50 years.
New South Wales officials released figures on Wednesday showing that every part of the state is affected, with nearly one-quarter classified as being in "intense drought". Around 60% of neighbouring Queensland is also in drought, as well as parts of Victoria and South Australia.
The Sunday Telegraph this week reported the federal government will give hardest-hit farmers $12,000 in two lum-sum payments from September in addition to a modest welfare payment of $295 welfare payment.
The state government last month quietly amended its drought map in response to fierce criticism from farmers without a green blade of grass, whose properties were categorised as being merely in "drought onset".
"We are the land of droughts and flooding rains".
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Australian Prime Minister Malcolm Turnbull, second right, looks at dry soil with farmers during a visit to Strathmore Farm near Trangie, 300 miles north west of Sydney.
Conditions are similarly dire in Queensland to the north, where the state government says almost 60 per cent of land is suffering drought conditions, which are also affecting the southern states of Victoria and South Australia.
The federal and NSW state governments are providing more than A$1.5 billion (S$1.52 billion) in drought relief packages, created to offset the cost of feed and freight, and increase access to mental health services for farmers feeling the strain.
Others have had to bulldoze orchards or lose their farms, leaving entire families without income, according to Australian media. We've got no idea so we run blind. "Some areas of the state did receive some welcome rainfall this month that has provided a little relief for stock and domestic water", he added.
Grazier Mark Wylie has spent Aus$30,000 in the past six weeks boring for groundwater, to no avail.