THE Victorian Farmers Federation (VFF) says Federal Government water buybacks are creating an unfair market where corporates and government purchasing power are pushing ordinary irrigators to the sidelines.
VFF Water Council Chair Andrew Leahy said recent water purchases highlighted how distorted the market had become.
“Family farms cannot compete against the Federal Government and major corporate investors with enormous financial firepower,” he said.
“It’s no longer a level playing field. Farmers trying to secure water to grow food and sustain communities are competing against taxpayer-funded buybacks and major investment entities with access to massive amounts of capital.”
Recent reporting revealed the Commonwealth purchased another $276 million worth of water entitlements in May alone, including significant parcels from corporate and investment-backed entities.
The VFF had concerns over public confirmation from some commercial companies, including that they have sold lower reliability water entitlements to the Commonwealth and intended to reinvest into higher security water rights.
“That should send alarm bells ringing through every irrigation community in the Basin,” Mr Leahy said.
“These companies have openly stated this sale would enable reinvestment into high security water rights. That means government-funded buybacks are effectively injecting more capital back into an already overheated market.
“The result is even greater competition for high reliability water. This is the exact water dairy farmers, horticulturalists and food producers rely upon to operate.
“When corporates can sell water to government at inflated prices and then re-enter the market to acquire premium entitlements, ordinary irrigators are left asking how they are expected to compete.
“These are not abstract policy decisions. Higher water prices flow directly into higher production costs, reduced farm viability and more pressure on jobs, food production and local economies.
“The Federal government cannot continue pretending these buybacks occur in isolation from the market.”