Water Markets

Water Markets

Water markets are important to the efficiency and productivity of irrigated agriculture.

Water markets allow irrigators to increase their water supplies when needed, earn income by trading their water rights, expand production, or release capital for investment in their business.  

The value of water entitlements on issue across Australia in 2019–20 is estimated at $26.3 billion, which includes entitlements held by environmental water holders and others. 

Water markets were made possible with the ‘unbundling’ of land and water rights. Over the past two-decades, water markets in the Murray-Darling Basin have evolved into a large and complex set of markets valued at more than $1.8 billion per year.  

There is significant need for regulation to catch up with the rapidly evolving water markets in the Murray-Darling Basin. 

A recent ACCC review has found significant deficiencies in current water trading arrangements, and the need for decisive and comprehensive reform. The ACCC has made 29 recommendations covering themes of: governance of the Basin water markets; market integrity and conduct; trade processing and water market information; and market architecture.