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Abstract

In this paper the incremental values of water are calculated for irrigators in the Fish-Sundays Scheme of South Africa's Eastern Cape province. The socio-political pressure for redistribution of agricultural resources provided the imperative for this study. The model of the Fish-Sundays Scheme reflects a survey of 50 000ha of fodder and citrus production. It explicitly models the water demand on sixteen typical farms, for five irrigation technologies, six crops and four livestock activities. The existing allocation generates an average value of R0.0423/m3/year, which increases to R0.0681/m3/year if farmer-to-farmer trading is allowed given existing infrastructure. Unrestricted trade raises the average value to R0.0719/m3/year. The marginal cost of additional water in the source basin is R0.05/m3/year for the first 315 million m3 and R1.27/m3/year to extend capacity beyond that.

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