Grow peanuts! as a Biofuel. What drove the first diesel engine? Peanut Oil.

I don't see any reason why buybacks shouldn't be via water savings where possible. After all we want the water that is eventually allocated to farmers to be used as efficiently as possible. There's not that much gain for the country by simply buying entitlement and then too apply whats left poorly.

After all irrigation production in the MDB is about $6 billion per annum, and to my thinking fully financing the govt's $1 billion per year spend on the MDB. Add in capital gain realised down the track and monies spent on efficiency and water saving will well and truly cover the extra $/ML
spent now on infrastructure.



Which brings me to another thought, that temporary water purchases solve a lot of problems.

i, It's going to take a long time to achieve required results spending $1b a year.

ii, water is trading at about $100/ML on the murray at present. 1500GL purchased per annum will cost $300 million or less each year[allowing for increases]. In a big water inflow year the govt wouldn't need to buy any. In a very low water availability year it may be that there is none to buy.

iii, that $300m wouldn't cost anywhere near the borrowing/opportunity cost of a $10 billion investment.

iv, those who may not wish to sell entitlement, yet may not be making good cash returns, may be willing to sell temporary water. The water left for irrigation should then get the highest possible return. ie those who make greater profits per ML are less likely to sell.

v, the capital value of entitlements is not extinguished - although it's not clear to me whether the govt plans to count licences it holds as assets on it's balance sheet. Or if they'll be available for resale.

Barnaby,
I wish the Nationals would seriously consider "going it alone" as a 4th political party.
As I see it.. you are the only "real saviour" for the people of the land and rural Australia.
During this Election ..not nearly enough support has been given/offered to promote confidence in our rural farming and food producing industries.
If any of the city population realised how important it is, to have Australia "self sufficient" and providing them with "food on the table"...they would be screaming from their "ivory towers" !!!...SUPPORT RURAL AUSTRALIA !!
Unfortunately, until the average ,ignorant city dweller starts "paying through the nose" ...or suffers a few doses of "food poisoning"..they won't wake up
and realsie....by then it maybe ..too late.
Keep up the excellent work...Barnaby.