Weekly Water Update - 23rd March 2021
Significant directional movements lower for all allocation markets this week, a combination of the rainfall events that have transpired over Eastern states in the last 3-4 days and counting, and the supply side with Murrumbidgee and Goulburn water continuing to be transferred into the below choke zone of the Murray river. The MDBA has continued to call out Murrumbidgee water for delivery with another 45GL ordered for April, and possibly more into May based on Lake Victoria levels as the month progresses. The market will continue to reflect this trade whilst the spread between zones is presenting a reward for transfer risk ($30-$35 today)
On rainfall, the map below highlighting the significant falls across the Murrumbidgee and Macquarie catchments in the last week (and continuing into tomorrow). The map below doesn’t capture overnight totals with notable mentions for Moree (150mm), Goondiwindi (100mm), Canberra/ACT (50-75mm). It is way too early to call out the Darling system today however it is a safe assumption that this event and the season shaping up for Northern NSW are providing the best outlooks for Menindee Lakes in about 5 years…we will watch this very closely in the coming months in terms of next season supplies for lower Murray
Murray catchment rainfall has been on the lighter side in comparison however the forecast for the remainder of this week looks promising for Hume and Dartmouth
New South Wales Rainfall Totals (mm) 23rd March 2021
Carryover continues to be sought after and will be even more so following this latest rainfall event, the surprising data release from last week being the predicted 42% carryover for the NSW Murray General Security. Vic carryover is extremely short below the choke (which is nothing we didn’t already know), and allocation account balances are the highest in some 3-4 years for Victoria account holders, which poses the question of how much allocation will be parked against High Reliability at the end of this season? We may see a lot more allocation move above choke and onto NSW licences before this season is out, therefore the forecasted carryover for NSW G/S could be even larger than the predicted 42%
Forward water have been quiet this last week with lower Murray $240-$250 asking, and Murrumbidgee $170 asking. Depending on run-off into dams for the Murrumbidgee, forward water markets will likely need to reprice lower to strike a counterparty. As dam levels increase between now and June the surety of allocation for July/August will improve accordingly therefore reducing buyer interest in forward protection for next season
Allocation markets (as at this afternoon):
Murray River - $70, parity across the choke is now evident with pricing off $25-$30 this week
Goulburn - $70, parity to Murray with Inter-Valley trade continuing
Murrumbidgee - $45-$50 – local rainfall in the key irrigation areas taking out some demand this next few weeks
Top Opportunities – All Enquiries Welcome
Permanent markets buyer interest of note in the following zones:
Murrumbidgee General Security – offering $2,100 dry
Murray (above choke) General Security – offering $1600 dry
300ML Lower Murrumbidgee Zone 2 Groundwater DRY – $4,000
800ML Lower Murrumbidgee Zone 3 Groundwater DRY – $3,600
Murrumbidgee River Temporary Supplementary (current season) – offering $15/ML – up to 1,000ML
Murrumbidgee Irrigation Forward Supplementary (delivery 1st July) – offering $45/ML – 1,000ML
Murrumbidgee Carryover (Holders Risk) – offering $120/ML – call to discuss
As always, please call to discuss any enquiries or requirements you have.
Regards,
Grant Volz
Director – Terra Ag Rural Agencies
Unit 30, 16-24 Whybrow St, Griffith NSW 2680
M: 0418 916 031
F: 02 6964 6095