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BACKGROUND: Nitrogen (N) fertiliser used on crops is among the main sources of water pollution. Reliable measurement of N losses from land uses in catchments is key to designing effective management strategies that minimise those losses at the same time as keeping farms profitable. In the present study, we used a management simulation tool within the Agricultural Production Systems sIMulator (APSIM) to assess the effect of fertiliser management on N leaching from croplands in the Aparima catchment in Southland, New Zealand. The assessment was based on two N‐fertiliser regimes: (i) Scheduled (conventional) where, N‐fertiliser rates and timing of application followed a prescribed programme, and (ii) Soil‐test where, N‐fertiliser rates and timing depended on daily analysis of simulated soil N levels. Four rotations (continuous wheat, pasture‐wheat‐grain oats, wheat‐fodder beet‐peas and wheat‐green oats‐fodder beet‐peas) were used in the evaluation. RESULTS: APSIM simulated crop productivity with reasonable accuracy. Yields were 2% greater, fertiliser N input was 11% lower and leaching was 20% lower under the Soil‐test compared to the Scheduled fertiliser management. These results show the potential of a Soil‐test based fertiliser application to increase fertiliser‐N use efficiency and reduce the risk of N loss to the Southland catchment water systems. CONCLUSION: The present study demonstrates a dynamic farm systems model can be a viable tool to generate valuable data for assessing the productivity and environmental effects of cropping systems at a catchment scale. © 2021 Society of Chemical Industry [ABSTRACT FROM AUTHOR]