As we near the end of this year, we would like to wish you and your family a safe and happy time over the Christmas and New Year period. As always, we will remain open over the period and are happy to take your calls should you have any water requirements.
2016 has been a year of contrasts. It began with ongoing dry spells, warm conditions and limited water storage. By June the forecast suggested that this trend would extend well into the 2016/17 water season, which was supported by low opening allocations for NSW, VIC & SA. Now, following significant rainfall events across major storage regions that began in September and concluded in November, many outlooks moved from Dry to Average or Wet.
Over winter and spring, a great deal of storages received record rainfall with the Murray Darling Basin (MBD) reaching an almost 4 year high. This incease storage brought with it higher than expected allocations for most High Security and High Reliability entitlements in the MBD, which already sit at 100% prior to summer.
Whilst the rainfall events represented a bumper season for a variety of crop types, some regions were hit with storms and volumes of rainfall that were not conducive to a strong season. This came in the form of storm damage, flooded land or wet conditions that lasted beyond planting periods for certain crops.
WATER AVAILABILITY 16/17 vs 15/16
In the Southern Connected System, opening allocations were lower than previous years for many entitlements due to low water storages and the prospect of a prolonged dry outlook. However, July brought with it large volumes of rain across key agricultural regions, which extended well into October and beyond. Some General Security entitlements began receiving their first allocations in years.
The result saw total storages climb to near 4 year highs across the Murray Darling Basin. This pushed the price of temporary water down due to an oversupply, which further hampered by multiple trade restrictions (Barmah Choke, Goulburn to Murray) that saw the market became more fragmented than in previous years
Along with increased storages, came increased risk of spill. In early October, the NVRM announced all Carryover on Victorian Murray HR accounts was lost to spill. Water in LR accounts remained protected against spill loss.
For more information on Southern Connected System Allocations, please visit our Water Allocations page below.
Lachlan and Macquarie Valleys have received higher allocations than in recent years with many catchments in the Northern Rivers at their highest levels in many water seasons.
The total allocation for General Security licence holders in the Lachlan Regulated River for 2016/17 water year is 124% of entitlement.
With the higher catchment flows, Macquarie General Security entitlement had much greater liquidity. With a larger volume of entitlements on issue and increased trading levels, temporary water prices were at their lowest since the beginning of the 2012/13 season. Permanent pricing remained consistent.
All regulated river storages are effectively full.
Lower Namoi regulated river general security water users currently have access to 123.31% of entitlement. All other High and General Security Entitlements in the Lower and Upper Namoi valleys have already received the maximum allocation for the 2016-17 water year.
General Security licence holders in the Gwydir Valley currently have access to 72.43% of entitlement, with High Security at 100%. The storage volume in Copeton Dam, where inflows are sourced, peaked in mid-November. Access to supplementary flow ceased in the first week of November 2016.
Across much of Queensland’s major agricultural areas, water allocations have been higher than recent years. Similar to other water markets across Australia, these high allocations are due to significant rainfall into storages over the winter and spring period. These high allocations have allowed many irrigators to complete their programs with their owned allocation, rather that buying substantial amount of temporary water. This strong level of supply had reduced demand and lowered the temporary price of water.
While much of the country, including Queensland, have been blanketed with heavy rain, one exception is Mareeba where conditions have remained warm and dry. Drier conditions and higher temperatures are beginning for the summer period in other Queensland regions like the Burdekin and Bundaberg. The level of rain over the wet season will determine whether the price of temporary water rises due to demand or continues to remain low, with a larger supply.
The BOM is predicting a warmer than average 3 month period from December to February. Average rainfall across the Southern Connected System is also expected to be below average. Unlike the mid-year forecast, the BOM rates this forecast accuracy as high. Following this announcement, Waterfind has noticed increase demand for temporary water.