Shock as water allocations for SA River Murray irrigators could be as low as 14 per cent

River Murray irrigators are reeling from a warning about decade-low water allocations that could force them to choose between abandoning crops or going into crippling debt.

• Third-worst rainfall in Murray-Darling Basin on record
• SA irrigators face 50 per cent allocation cuts

River Murray irrigators are reeling after being warned of decade-low water allocations that could force them to abandon crops or risk taking on crippling debt.

In a worst-case scenario, the State Government says opening allocations for 2019-20 could be as low as 14 per cent.

Environment Minister David Speirs said it reflected “extremely dry conditions” in the Murray-Darling Basin.

Mr Speirs said the early warning allowed growers to “plan for the worst”, but his department believed there was a “very high chance” of allocations improving as the season progressed.

The Advertiser revealed earlier this month that allocations could be halved to 50 per cent.

SA Murray Irrigators chairwoman Caren Martin had estimated it could be much worse than that, but not as low as the “real shock” delivered on Monday, a month before opening allocations are set in mid-May.

Barmera grape grower Ashley Chabrel with his wife Natasha, son Angus and daughter Avril on their property. Picture: Tricia Watkinson

“We hope to God it rains between now and then,” Ms Martin said.

After two years of low rainfall and inflows across the Murray-Darling Basin, the volume of water in storage is about a third of capacity and declining.

A 14 per cent opening allocation in SA would be the lowest since 2009-10, before the Millennium Drought broke, leaving growers to rely on the temporary water trading market.

Ms Martin said the market faced a demand crunch from growers needing water to finish this year’s crops, and others wanting to supplement the low allocations to come.

The scramble for water could become “hyper inflationary”, and growers could face the temptation of leasing water to keep crops alive that would not be profitable. She urged irrigators to heed the lessons of the Millennium Drought.

“Those who made the tough call (to abandon unprofitable crops) did the best in the long run because they didn’t ride the downward debt spiral.”

Ms Martin said 30 years of politicking over the river system had failed — as evidenced by people being able to make more money trading water than growing anything — and called for government water buybacks upstream and a federal Royal Commission.

“It’s a rich man’s drought and the market and the (water) brokers and the politicians know it.”

Summer Fruit Australia board member and stone fruit grower Jason Size said he was “at the mercy of temporary trade prices”.

He said many growers’ crops would not be profitable given the current leasing price of $500/ML, while buying was out of the question at 10 times that price.

Even if he made smart decisions about letting his “marginal” crop varieties die off, his profitably on the stronger ones would likely be “quite low”.

But with rain, he said, “things could change in the snap of a finger”.

Barmera wine grape grower Ashley Chabrel and SA Murray Irrigators deputy chairman, said such low allocations were particularly disappointing when the horticulture sector was producing good returns.

Ashley Chabrel, with his family, says the risk of lower water allocations will take the shine off a good season for growers. Picture: Tricia Watkinson

“Grapes, citrus, almonds — they’re all travelling well,” he said.

“The allocation announcement just takes the shine off what should be a good season for growers. They’re really going to have to think about whether they irrigate some crops and how much they irrigate.”

He was confident there would be less panic buying of water than in previous droughts.

Deputy Opposition Leader Susan Close said irrigators were “paying the price” for the Federal Government’s failure to deliver the Murray Darling Basin Plan properly.

Meantime, the viability of using South Australia’s $2.2 billion desalination plant to help the River Murray will not be known until after the federal election.

State Environment Minister David Speirs told The Advertiser in February that a $2 million report examining South Australian water use, including how the desalination plant could be better used, was expected to be finished within months.

The timing of the report was expected to make the desalination plant a key election issue, with the State Government expecting federal assistance to pay for using it.

However, Mr Speirs has confirmed the report is still on the drawing board.

“How South Australia best uses the desalination plant, as well as other urban water projects, is a complicated area and something we want to make sure we get right,” Mr Speirs said.

In February, the idea of using the plant to help boost the health of the River Murray received conditional support from the Federal Government, Opposition and Centre Alliance.

— with Matt Smith

Delay for desal plant river study

THE viability of using South Australia’s $2.2 billion desalination plant to help the River Murray will not be known until after the federal election.

State Environment Minister David Speirs told The Advertiser in February that a $2 million report examining South Australian water use, including how the desalination plant could be better used, was expected to be finished within months.

It was assumed the timing would make the desalination plant a key election issue, with the State Government anticipating federal assistance to pay for using it.

However, Mr Speirs has confirmed the report is still on the drawing board.

“How South Australia best uses the desalination plant, as well as other urban water projects, is a complicated area and something we want to make sure we get right,” Mr Speirs said.

In February, the idea of using the plant to help boost the health of the River Murray received conditional support from the Federal Government, Opposition and Centre Alliance.