Fruit and veg prices could soar if growers’ water discount drained
Queensland growers are flooding the government with pleas to retain a vital 15 per cent irrigation discount, warning that scrapping it could drown farms in debt and jack up food prices.
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Queensland’s fruit and vegetable growers have issued a stark warning to the state government, urging it to reconsider moves to scrap a crucial irrigation water discount, a decision they say could devastate farm viability and send food prices soaring.
In a letter sent to Premier David Crisafulli and key cabinet ministers, Queensland Fruit and Vegetable Growers chief executive Rachel Chambers voiced strong opposition to the proposed pricing changes, describing them as “unfathomable” in the current climate of trade tariffs, rising costs, natural disasters, and ongoing instability across the sector.
“At a time when input costs have already increased between 30 and 65 per cent, it’s inconceivable that government support – which has been hugely impactful and appreciated – would be withdrawn,” Ms Chambers said.
Currently, irrigators benefit from a 15 per cent discount on bulk water prices, a support measure not factored into the Queensland Competition Authority’s recent 2025-29 SunWater Irrigation Pricing Proposal.
The Queensland Competition Authority has proposed increases of between 20 and 85 per cent across various schemes.
Without the discount, growers fear their water bills could double within a year.
“It’s a perfect storm,” said Burdekin farmer Mario Barbagallo, who buys water from SunWater and is the chairman of the Burdekin River Irrigation Area Irrigators.
“It’s not just a price change, it’s a shift in principle.
“We need the 15 per cent discount to continue for the duration of the coming four-year price path from 2025 to 2029.
“That should go some way to allow Government to implement efficiency measures into SunWater.
“The discount should not be seen as a free kick to irrigators, it is to help cover some of the inefficiencies within SunWater until they are addressed,” Mr Barbagallo said.
SunWater refused to answer questions on when the CASPr system would be operational or whether the $34 million venture would be shelved at a loss.
However, in a statement on Sunday, a SunWater spokesperson said the government-owned entity had provided extensive information on the CASPr Project in its submission to the Queensland Competition Authority.
While final pricing decisions are yet to be made, the uncertainty has thrown many growers into disarray, with some industry representatives privately questioning whether officials “have got their wires crossed or know something we don’t”.
QFVG has asked the government to extend the 15 per cent discount at least in the short term, arguing that many of the system’s current inefficiencies, which are not the fault of growers, still need to be addressed.
“We’re not asking to be propped up forever,” one grower said.
“But right now, this discount is keeping our operations viable while SunWater sorts out internal issues.
“Cutting support now is like ripping out the foundation before the repairs are done.”
One key concern among growers is that the bulk water price rise may be used to pay for massive project overruns associated with the ill-fated CASPr (Customer and Stakeholders Project).
CASPr consumed over $38 million in ICT expenditure over four years in an effort to replace an outdated, though business-critical, billing system.
The legacy billing application, ORION, was acknowledged by SunWater as having technical and cyber vulnerabilities more than five years ago yet CASPr has stalled with no revised time frame for the replacement billing system announced.
SunWater is seeking to recover $34.6 million from the CASPr project as a component of the new irrigation water prices to be effective from July 1.
In February, the QCA recommended SunWater reduce its costs including cutting its now-shelved CASPr technology system from $34.6 million to around $18.5 million.
“The fear is they’ll start trimming back necessary infrastructure jobs to make up the shortfall,” the grower added.
“That just kicks the can down the road.”
The QFVG letter was circulated to 13 cabinet ministers, including Water Minister Ann Leahy, Treasurer David Janetzki, and Minister for Primary Industries Tony Perrett.
Ms Chambers also stressed the importance of both water and energy pricing as critical levers to support Queensland’s agricultural productivity.
“This is not just about growers – it’s about every Queenslander who values fresh, affordable food,” she wrote.
The new July 1 water prices for SunWater customers are yet to be revealed despite the state consumer watchdog publishing its long-awaited draft report on Sunwater’s future water pricing in February.
The Queensland Competition Authority review, aimed at aligning water charges with cost recovery, triggered fears of significant price hikes for some customers, particularly in the Burdekin-Haughton and Nogoa-Mackenzie regions, while also exposing inefficiencies in the state’s largest water distributor.
The new SunWater prices are expected to be made public by next month.
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