Significant trading in permanent water licences is highlighting the long term value of allocations in the Nogoa, Mackenzie irrigation area.
Principal of Emerald Land and Cattle Company, Kerry Hayes said his company is starting to trade increasing volumes due to a number of factors.
Despite crippling floods in 2008 and 2010, Mr Hayes said that the ensuing seasons have been extremely dry and growers were seen to secure permanent allocation offer having to temporary prices of $80-$150 per megalitre over the last three water years. Into that scenario, we also have large agricultural companies securing more allocation to compliment their expansion strategies and most recently a new horticulture tree-crop industry securing land and watering allocation for the orchards.
Recent sales have been around $1500 per megalitre and we see an upward trend because of the very finite amount of water in our system. It is a bright spot in what has been generally bleak outlook, and shows that the region is still offering opportunity, said Mr Hayes. It has been a timely turn-around for some as recent put-call water options for a resource company have not been taken up and this demand will absorb some of that allocation.