South Australia's drought-affected farmers will have access to $10 million in drought concessional loans from the Commonwealth's support package.
It's the first time federal support has flowed to SA, following months of negotiations between State and Federal Governments.
The Commonwealth will also match the state's contribution of $275,000 to manage animals and improve water infrastructure.
State Agriculture Minister Leon Bignell has welcomed the announcement and says negotiations with the Federal Government will continue.
"I had a good meeting with the Minister Barnaby Joyce last Friday and I think he wants to help South Australia out which is a good thing," Minister Bignell said.
"It just increases the pool and we'll keep working with the Federal Government on other ways we might be able to help people who are doing it tough up in our outback."
In a statement, Minister Joyce said the far north of South Australia was experiencing prolonged dry conditions, causing hardship for pastoral businesses, remote communities and land and water resources.
"This money will help farmers invest in new watering points; replace and upgrade polypipe and solar pump systems and clean watering points; and install infrastructure which will help meet emergency animal welfare needs," Minister Joyce said.
Minister Bignell says the federal and state contribution of a combined $550,000 will be distributed by industry group, LivestockSA, with pastoralists deciding how the money is spent.
"Really the people who know best what to do with the money are out there living on the land," he said.
It's not clear when applications will open for the drought concessional loans.
Col Greenfield from Billa Kalina Station north-west of Roxby Downs says the announcement is a step in the right direction.
"It's certainly a lot more than what we had a month ago," he says.
"The best thing about the Federal Government [funding] matching ours is that it enables LivestockSA to better distribute the funds more fairly and evenly.
"It was going to be fairly tough for everyone to get a reasonable amount out of just what the state gave us.
"Now with this extra funding it can certainly make a difference."
Mr Greenfield says pastoralists have also welcomed the acknowledgment that South Australia is in drought.
"It's great that they realise that South Australia does have pastoral country that gets in drought - it's not just the eastern states."
But he says farmers are now looking for more long-term measures for future drought events.
"The critical thing is what's going to happen in the next drought, which is a sure thing," Mr Greenfield says.
"Or this one continuing past the 30th of June."
© ABC 2014
20:55 EDT A blistering heatwave is scorching western Queensland with temperatures above 40 degrees Celsius and will spread to the south-east later this week.