“Logging in headwaters at a time like this inevitably sends heavy sediment flows into river systems, destroying water quality, killing native fish and turtles and permanently damaging river flows,” he said.

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Dailan Pugh, a spokesman for the North East Forests Alliance, said loggers run the risk of creating long-term damage operating in the wet as their machinery creates huge ruts and compacts sodden soils. Tree removal from headwater regions can worsen erosion and pollute rivers.

“Logging will just cart the soil into streams,” Mr Pugh said. “It turns into an environmental nightmare.”

He said the attempt by the Environment Protection Authority to create a 20-metre buffer for logging near headwater streams in bush-fire affected regions had gone some way to limit the damage before Forestry Corp broke off talks. Some of the largest trees are found in such areas, Mr Pugh said.

An EPA spokesman said officers were actively monitoring all stages of logging, including operations “in the aftermath of the recent floods and storm weather events across the state”.

The Sun-Herald approached Deputy Premier and forestry minister John Barilaro for comment.

Separately, Prime Minister Scott Morrison announced on Saturday that flood-affected businesses would be able to access recovery loans first introduced in response to the COVID-19 pandemic.

The expanded scheme – previously available from April only for businesses that have been on JobKeeper subsidies – will allow businesses with turnover of as much as $250 million to access loans worth up to $5 million, over a 10-year term and with the option of a two-year repayment holiday.

The loans will be provided by banks, with 80 per cent underwritten by the government

“Now we plan the recovery and we back the plans of people on the ground about how they’re going to rebuild,” Mr Morrison said.

The announcement follows the separate introduction of recovery grants jointly funded by the federal and NSW governments.

Mr Morrison said communities were now heading into the clean-up phase following the floods and insurance assessors were on the ground in affected areas.

“Assessors are out there even as we speak, and people are starting to work again with how businesses, particularly the producers in this region, need to be able to get back up on their feet,” Mr Morrison said.