The findings are contained in two reports – Irrigation in the Murray-Darling Basin: Financial performance in 2006-07 and Irrigation in the Murray-Darling Basin: Farms trading temporary water in 2006-07 – released today by ABARE’s Executive Director, Phillip Glyde.

“The report results suggest water trading was effective in re-allocating water among users in 2006-07, with the ability to trade water appearing to have assisted some irrigators in avoiding substantial financial losses in 2006-07, either by obtaining income from water sales or by purchasing water to maintain production,” said Mr Glyde.

Dairy farmers were prominent buyers of seasonal water allocations in 2006-07. This was because they sought to offset relatively low seasonal allocations. Conversely, horticulture farms, with generally more reliable irrigation water entitlements, tended to be prominent sellers in most regions.

However, a recent ABARE case study indicates that, in 2007-08 in the southern Basin, perennial horticulture farmers were the most common buyers, with irrigated broadacre farms the most common sellers.

“The range of financial returns for irrigation farms across the Murray-Darling Basin indicates that there are no industries or regions with significantly better or worse rates of return than others,” noted Mr Glyde.

In 2006-07 ABARE commenced a program of surveying irrigation farms across 10 regions of the Murray-Darling Basin.