Izhar Raz moved to Kibbutz Nahal Oz from Tel Aviv in 1958. He has been a farmer ever since, and currently oversees field crops for the kibbutz. "We grow potatoes, carrots, sunflowers, wheat, watermelon, cabbage and peppers," Raz says in his office shortly before heading out for a tour of the fields, which are next to the border with the Gaza Strip.

Raz expects profits from wheat sales this year to fall 30 percent from last year. By next month, what is currently termed low rainfall could turn into a drought year. The lack of water, which has hit agriculture in the south of the country particularly hard, is stinging farmers' profits and is liable to force up prices of fresh produce.

The finance minister can declare a drought year based on crop yields. At Nahal Oz, the farmers say, the lack of rain means a 70-percent decline in wheat yields this year. Raz explains that wheat is not usually irrigated artificially and depends on rain alone. But this year, some of the wheat on the kibbutz was irrigated, with saline water, to provide feed for the cattle.

"Anyone flying over Israel now and three years from now will be able to see that agriculture in Israel will change," Agriculture Minister Shalom Simhon told Haaretz in an interview.

He said that nearly 100 million cubic meters have been cut from the allocations of fresh water for agriculture - from 550 million cubic meters to 454 million. Ministry officials cannot predict exactly how the cuts will affect crop yields.

According to ministry Director General Yael Shalties, 52 percent of the 1 billion cubic meters allocated for agriculture is treated water. Until a number of years ago the fresh water allocation alone for agriculture stood at 1 billion cubic meters a year.

Increasing the country's water-treatment capacity could help save Israeli agriculture, but that means spending money on treatment facilities.

Most of the water used to irrigate crops in the South is treated wastewater from the greater Tel Aviv region. Nahal Oz gets 1.150 million cubic meters for irrigation. The scarce rainfall has forced the kibbutz to irrigate more than usual.

"We used about 15 percent of our total allocation in the past several months that we hadn't planned for," Raz says. "In the end we'll have to reduce plantings."

Deciding which crops not to plant is no easy matter. One option is to put in crops that require less water, but they are less profitable. Hothouse growing is another option, but while it uses less water it is not suitable for every crop.

"Reducing water allocations dramatically in the future, if it comes to that, will change the face of Israeli agriculture," Simhon says. He proposes a reduction in field crops for a period of three or four years. "It could change the color of the land, with large areas that are no longer green," he says.