The National Irrigators’ Council (NIC) has welcomed the announcement of the terms of reference for an ACCC inquiry into the water market.

CEO Steve Whan said “NIC has been highlighting concerns and advocating an inquiry into the water market for some time.  We are pleased to see the announcement by the Treasurer and Water Minister delivering their election commitment to refer this to the ACCC. 

“Australian governments decided to create water markets so that water could move to its highest value use, to encourage efficiency and boost agricultural production.  The creation of water markets – which predates the Murray Darling Basin Plan – also provided a mechanism that allowed Government to buy water back for the environment.

“To a large extent the water market has done what it was intended to do; water has moved to high value crops and in 2017-18 the value of irrigated agricultural production from the Murray Darling Basin had grown to more than $8.6 billion (nearly 15% of all Australia’s agricultural production).   

“However, in any market – particularly one for a resource that is so subject to climate variability – there are winners and losers.  There is no doubt the current drought conditions have exacerbated negative impacts of the water market for some regions and some types of crop.

“The stresses are particularly marked in a thin market where so many irrigators have zero allocation.  Since the market was created, 1 in every 5 litres of water that was available for production has moved to the environmental water holder, we have a severe drought and system constraints.  It’s no wonder people are worried.  

“The water market that has developed is complex and sometimes difficult to engage with or understand.  It has differing registration systems, standards of information, timeframes and a large range of products.

“NIC looks forward to the ACCC being able to work its way through this complexity and coming up with recommendations that provide transparency and fairness for all participants in the market.”

Media Contact:  Steve Whan 0429 780 883
Wednesday 7 August 2019