An independent social and economic analysis has been commissioned by the Victorian Government to understand how irrigators and communities across the southern connected basin (NSW, Victoria and SA) have been impacted by the Murray Darling Basin Plan, as well as to identify further potential impacts.
Key findings from the analysis are listed below:
- The dairy industry is now more exposed to the water market and heavily reliant on the allocation market. Dairy will be the first to feel the pressure of rising allocation prices
- Horticulture has bought large amounts of Victorian High Reliability Water Shares – now owning more than 40 per cent. If allocations drop below 40 per cent there will not be enough water to supply industries across Victoria, NSW and SA
- High Reliability Water Shares have been disproportionately targeted by the Commonwealth. This increases Victoria’s risk in dry years, as the entitlement market helps mitigate the impacts of drought on Victoria
- Reduced water availability may impact future tariffs and system infrastructure requirements
- Irrigators who participated in Commonwealth buybacks are now much more reliant on allocation purchases – from 0 – 12 per cent on the allocation market prior to participation to 26 – 52 per cent after participation
