Report forecasts grim news for Qld irrigators

IRRIGATORS in many of the large channel irrigation schemes across Queensland are facing big hikes in their water bills, increasing each year over at least the next five years, according to a report released late last week.

The Queensland Competition Authority (QCA) has released its interim report into SunWater irrigation prices. The State Government commissioned this report from the QCA so that it can determine future SunWater irrigation water prices – and ultimately it will be Government that decides what it does with prices proposed in the in the report.

QFF CEO Dan Galligan said the report spelled out particularly bad news for thousands of farmers in the irrigation areas near Maryborough, Bundaberg, Mackay, Theodore, Mareeba and the Burdekin.

He said there would be farmers that were facing water hikes of between 20 to 50 percent, including escalation for inflation, over the next five years if the Government decides to ask them to pay the prices that are being proposed by the QCA.

“While this would be a massive impost on irrigators, it would also eventually have flow-on effects to processing operations further along the supply chain. This will be lead in the saddlebags for rural communities and regional economies,” Mr Galligan said.

He said that QCA had capped real price increases in these schemes at a maximum of $2/ML per year, as has been the Government policy in the past.

However for the irrigation schemes near Maryborough, Bundaberg, Mackay and Theodore, it will take many more years of $2/ML real price increases to reach QCA target prices.

“This will be a large and unsustainable hit to farm margins given that these increases will occur year after year while the returns farmers receive do not grow at the same pace.

“For the longer term we need to find a pricing regime that is economically sustainable at the farm gate but also allows for irrigation schemes to invest in the modernisation that builds efficiencies and drives down costs.”

Other irrigators on bulk water supply schemes were not looking at the same price rises as those being proposed for channel irrigators, but are still being urged to get involved in the review process and upcoming meetings.

“We will be calling on the State Government to work with all irrigators and the sugarcane, horticulture and cotton industries to urgently look at options that can be considered to reduce scheme costs within the five years.”

QFF will be working through these options with our members to inform the QCA’s final report, which is due out in the first quarter of next year.

Irrigators are urged to attend public meetings on the QCA report and proposed prices, which will be held across Queensland irrigation regions in coming weeks.

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