“My view is that it will be very welcomed by farmers, who couldn’t afford any water and will provide them with an opportunity for an early watering of their fodder,” she said.
“We’ve been calling for environmental water to be released in these circumstances to no avail but this is a step in the right direction.”
Ms Sheed said the water needed to be kept for farmers.
“It is essential that this water be targeted to farmers who can use it,” she said.
“One point Minister Littleproud made was that it can't be on-traded.
“The removal of any speculation is so important given what's now an extreme shortage of fodder on the eastern seaboard.”
Member for Nicholls Damian Drum said he would be working with his Nationals colleague Water and Drought Minister David Littleproud to make sure the water ended up with those who need it most.
“Plans are there but we have got a lot of work to do,” he said.
“We have to ensure that investors don't get their hands on this.
“If you purchase any of this water you'll be expected to use it to grow a crop with it.”
Nearly 6000 farmers are expected to access a portion of the 100Gl, with Mr Littleproud confirming 25Ml will be a minimum allocation.
However, NSW Member for Murray Helen Dalton said many questions were still unanswered.
“The absurdity of farmers watching fresh river water flush past them and out to sea is something I’ve been screaming about for the past year,” Mrs Dalton said.
“I was somewhat pleased to see on Thursday the government might be getting the message, at long last.
“But there are many questions that haven’t been answered.
“Until we see the fodder growing, we can’t be sure of anything.”
The drought package also includes $1 million for each of the 122 drought-affected councils and shires along the east coast, if they need it.
At least six new shires and councils will also be offered $1 million.
A new program will also allow small businesses dependent on agriculture to apply for loans of up to $500,000 that can be used to pay staff, buy equipment and refinance.
There will also be $10 million for schools facing hardship as a result of the ongoing drought, including fee concessions for boarding students.
Another $5 million will help assist childcare centres experiencing decreased demand and the government will redirect $200 million from the Building Better Regions Fund to support drought-stricken communities, and pump an extra $138.9 million into road projects.