Water Trading Helps Irrigators Cope With Drought

As a city person in SE Oz I am glad to see something positive reported in our drought – can you believe all that water up north that we’re ‘willing away’?

A recent ABARE (Australian Bureau of Agricultural and Resource Economics) report, Dealing with irrigation drought: the role of water trading in adapting to water shortages in 2007-08 in the southern Murray-Darling Basin, analyses water trading data and presents ten irrigator case studies.

Water Trading – Using Available Water Better

With increased water trading and better practices it seems farmers are coping with historically low water allocations.

Overall, the study found irrigators were satisfied with water trading. Most trades were generally processed within a week or so though there were some delays in processing interstate trades.

“All irrigators who were interviewed indicated water trading had a positive influence in the management of their businesses by providing greater flexibility to manage water requirements in times of water shortage,” said ABARE EO Phillip Glyde.

About The Water Markets

Being able to buy extra water has reduced the impact of drought on farm production and the sellers have gained an interim income during times of low allocations that were inadequate to produce a viable crop.

The volume of allocations traded interstate increased from around 70 gigalitres in 2004-05 to 235 gigalitres in 2007-08.

Phillip Glyde also said:

“Trade into South Australia accounted for 63 per cent of total interstate trade. The bulk of the water trades were temporary trades in water allocations where the price ranged from around $200 to $1200 per megalitre across trading zones, in 2007-08. The net benefit of water trade into South Australia in 2007-08 was estimated to be $35 million.”

The ABARE study was commissioned by the Department of the Environment, Water, Heritage and the Arts (DEWHA).

Drought in the SE has become a way of life – in the city and the country. We HAVE to learn to live with it…