New government data is forecasting water allocation prices in the southern Murray-Darling Basin will likely stay low for a third consecutive year.
The latest Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) Water Market Outlook states that based on the current climate outlook from the Bureau of Meteorology, a wet scenario is the most likely outlook, with prices expected to fall to $58 per ML from $67/ML in 2021-22.
"Back-to-back La Nia years have recharged storages and have allowed carryover balances to rebuild. ABARES executive director Dr Jared Greenville said.The volume of carryover available in 2022-23 is the highest it's been in a decade,"
"High opening allocations and exceptional allocation outlooks for all major entitlements will provide a lot of certainty to irrigators in making crop planting and water management decisions.
"The continuation of lower water prices will help to support agricultural production, with the gross value of irrigated agriculture production in the southern Murray Darling Basin forecast to increase to $6.6 billion."
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La Nia conditions have disbanded at the beginning of this year, but there is a 50 per cent chance of it re-forming in spring 2022.
The outlook indicates that if La Nia reforms, conditions will possibly be even wetter than forecast in the wet scenario.
The forecasted continuation of wet conditions would make it the third consecutive year of excellent seasonal conditions for irrigated agriculture.
