Many times I’ve experienced loot falling down to the water and I can’t pick them up.
It tends to happen a lot to sirens. In this screenshot you’d think I’m able to reach this one but actually no. No matter how hard I tried. It was just at the threshold of unreachable on land. The moment I get close enough, my character starts swimming, and is unable to pick it up.
This one might be too hard to see because of the waterfall, so I drew a red arrow there.
This situation, the piece of iron ore that I mined fell to the water and I couldn’t pick it up.