Leaders want answers

By Country News on January 20, 2016

Water industry leaders are pleading for a halt in Commonwealth water buy-backs and an urgent review of the social and economic impacts of the Murray-Darling Basin Plan on rural communities.

A meeting of 90 key leaders at Tatura in October has agreed to set up a lobby group to take the Goulburn Murray’s concerns to governments.

Rising water prices and a deepening dry season have contributed towards the appeals to temporarily halt the transfer of water from agriculture to the environment.

Dairy farmer and Murray Goulburn Co-operative director Natalie Akers outlined the importance of the Murray Dairy region which she said generated about 25 per cent of the national milk production and was reliant on water for irrigation.

She said dairy farmers had already adopted more efficient watering systems, but were also now more exposed to higher temporary water prices.

She estimated about 120Gl of water had been transferred from dairy farmers to the environment which equated to about 289million litres of milk.That 289 million litres of milk is conservatively worth $144 million at the farmgate, and $360 million in regional economic activity.

Foregone dairy production in the GMID is not being offset by increased production of, or investment in, other industries, or new commodity ventures such as almonds.

Loss of more entitlements owned by dairy farmers to the environment will see the industry lose its modest post-drought recovery, and slide backwards.

She suggested the remaining water required for the environment should be obtained through capital investments in water savings rather than simply taking it from farms.

Ms Akers said farmers were interested in a balanced outcome for the environment.


Why temporary price is so high


•       Less water in the productive pool and on the market, and more people relying on the market to meet needs, having sold some or all entitlement.

•       Av. 400Gl a year carried over by private water users, including irrigators each year; previously it was used under old ‘use it or lose it’ system, or returned to collective pool for reallocation.

•       Additional 300 Gl held in Victorian public reserve to guarantee 100% HR allocation in following season, reflecting drought’s effect on inflow models. This was previously allocated as sales water or against Low Reliability entitlement.

•       488Gl early season reserve to cover GMID system losses and ensure system will run the following year. This was previously allocated towards HR and LR entitlements in the current season,

•       Low general security allocation NSW Murray (12%) and Murrumbidgee (29%), and increased competition from new investment in commodities such as almonds and cotton, are driving demand and price.

•       Very dry conditions, with a strong El Nino and positive Indian Ocean Dipole driving up temperatures and reducing rainfall across the southern basin, and increasing irrigation demand earlier in the season.

•       Environment allocated ~850 Gl a year against entitlements that irrigators used to own.

•       Environment carries over less than irrigators in Victorian system (2014-15): irrigators:                615Gl;  environment:     266Gl

-Dairy Australia

By Country News on January 20, 2016

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