Water allocation prices slashed since last year but on the way up
November 8th 2016
I spoke with Stock and Land yesterday about recent movements in water allocation prices in the southern MDB and how these compare to last year when the dry conditions led to a rapid increase in prices.
“This was pretty much exactly the time last year, when allocation prices took off in the southern basin,” Mr Olszak said.
“We had a very dry spring, so the average monthly price, for November was around $275/ML.”
“We are well below that this year, because of the very high winter spring rainfall event, across the system; it’s done two things, boosted allocations for the water in storage for irrigators to use, but also helped manage demand, as the dairy farmers haven’t had to do much irrigating through winter and spring.”
“Where we go from here depends on the rainfall outlook – if we have a dry summer, prices could continue to climb, but they are not going to get back to where they were, last year,” Mr Olszak said.
“We had a very dry spring, so the average monthly price, for November was around $275/ML.”
“We are well below that this year, because of the very high winter spring rainfall event, across the system; it’s done two things, boosted allocations for the water in storage for irrigators to use, but also helped manage demand, as the dairy farmers haven’t had to do much irrigating through winter and spring.”
“Where we go from here depends on the rainfall outlook – if we have a dry summer, prices could continue to climb, but they are not going to get back to where they were, last year,” Mr Olszak said.
Excerpt from interview with Andrew Miller with Stock and Land