A Manus Island refugee transferred to Papua New Guinea's Port Moresby for medical treatment says food rations refugees are selling to buy other essentials have been reduced.
108 men from Manus are in the capital's Granville Motel and don't receive a weekly $US30 dollar allowance that's given to about 70 refugees in two other lodges in the city.
The refugees in Granville sell their lunches and beverages in order to afford toiletries that are not supplied.
On Monday night, the men were told their daily milk ration was cut from two 250 milliltre bottles to one.
The refugee said the cut was a reaction to the men selling their milk for 30 US cents per bottle.
He says their daily drinking-water ration has also been capped at six 600 millilitre bottles per man, which was previously unlimited.
The refugee said they were not selling the water but could earn about 75 US cents by selling 24 empty bottles.