Water use under microscope

By Country News

As the region battles dry conditions, water prices rise and the battle for water becomes fiercer, concerns are growing regarding what a prolonged drought would mean for the water market.

However, despite increasing concerns, ABARES water and climate economist Mihit Gupta said recent modelling suggested that even if the millennium drought was to repeat itself, the peaks in water prices in the southern Murray-Darling Basin likely wouldn’t be any more severe than those experienced in 2006-07.

‘‘Although the water available for irrigation is lower ... we would expect to see similar price peaks but less years with low prices,’’ Mr Gupta said.

The in-depth modelling, which considered water usage and availability across a number of sectors, revealed that grazing pasture had decreased its water usage the most, as farmers moved away from this form of production.

Rice, broadacre, cereals and vegetable water usage has also decreased, with increases in hay, grapevines, fruit and nuts and cotton as producers pivot towards these industries.

With almond production in particular booming, Mr Gupta said the modelling accounted for 190Gl/year increase in water usage from that sector but, if greater, it could be of concern to local water supplies should another long running drought occur.

‘‘However, if nut demand for water was higher than modelled, prices would also increase and it’s expected that water would largely be sourced from the Goulburn and Broken region,’’ Mr Gupta said.