The Potential Impact of Water Market Reform and Dairy Deregulation on Dairy Farming for the Lower Murray

A linear programming model is utilised here to reduce the uncertainty around the impacts of dairy deregulation and water market reform on the future productivity and profitability of irrigated farming in the Lower Murray River Irrigation Area. This information was provided to assist in evaluating the timing and mix of irrigation infrastructure investments under consideration by dairy framers in the Lower Murray Irrigation Area and the South Australian Government. Possible future milk prices received and water rights (including allocations and trade restrictions), together with possible improvements in on farm productivity are assumed in this regionally based model. The model results suggest that some dairy farmers will consider withdrawing from dairying and selling water allocation under a range of potential future milk and water prices.

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 Record created 2017-04-01, last modified 2020-10-28

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