State and federal ministers will meet for a drought update in Moree on Tuesday as the crippling dry spell drags into another long, hot summer.

Mr Littleproud has twice written to ministers in the worst-affected states, urging them to pay council rates for small business and farmers suffering with drought.

He also wants them to provide payroll tax exemptions and give crown leasehold relief for a year.

"This is where the states need to kick the tin," Mr Littleproud told AAP on Monday.

"We keep on going out - when's the last time you heard an announcement from state governments on their increased response to this drought?

"Everyone seems to be looking at us, but they've signed up to an agreement to help farmers as well. It only seems to be the federal government that is kicking the tin."

NSW Agriculture Minister Adam Marshall, who has criticised Mr Littleproud in recent months, wants a one-stop shop for drought payments instead of multiple channels like Centrelink and state agencies.

Mr Littleproud said state funding was a more urgent priority.

"We're prepared to work through the complexity, but let's not be diverted from the fact the states need to kick the tin with cold hard cash - not just administrative measures," he said.

He accused the states of being "stagnant" and needing to "lift their weight" after the federal government announced relief packages, the latest of which was announced last month.

"We can talk about these things until the cows come home, but until they start cutting the cheque - like the federal government has - they're empty promises."

NSW has also raised the prospect of federal funding to help insurance companies offer a multi-peril farm product to cover drought and other natural disasters.

But Mr Littleproud shut down the idea.

"The Australian taxpayer should not be subsidising multinational billion-dollar profit companies to come in and make billions more," he said.

Ahead of the mid-year budget update due next week, Mr Littleproud said the federal government would continue to be agile on drought spending.

"We've proven that we'll continue to do it as the drought intensifies. I don't think the states have proven just yet."

Mr Marshall launched a scathing attack on Mr Littleproud two months ago for visiting his electorate during a drought tour without telling him.

There's also been tensions between NSW and Canberra over the Murray-Darling Basin Plan.

But Mr Littleproud denied the relationship was hurting cooperation on drought.

He said it was the responsibility of the local federal MP, Barnaby Joyce, to notify state counterparts about visits.

"The reality is we work with anybody that wants to work constructively with us. We've proven that," the drought minister said.

"We would not have got as far with the basin plan without that constructive dialogue between states and we'll continue to do that with drought."

Australian Associated Press