Investment companies on notice for selling water to struggling farmers in Australia

Medium_duxton-capital-australia
Duxton Water is a fund of Duxton Capital, which, according to its website, "has been successfully implementing agricultural strategies since 2006, with Duxton Asset Management currently managing or advising investments across approx 540,000 hectares of farmland across five continents."
9news | 12 June 2019

Investment companies on notice for selling water to struggling farmers
 
By Chris OKeefe 
 
Investment companies making “ridiculous” profits from selling water to struggling farmers are on notice, as the Federal Government considers shutting them down.
 
Federal Water Minister David Littleproud said it’s the government’s “responsibility to act” if the competition watchdog concludes commercial water speculators are driving up prices and pushing out farming families from being able to buy water.
 
Duxton Water reported an increase of 288 per cent in gross profit to December 2018, to record a $15.5 million windfall.
 
The ACCC has been asked to inquire into the water market in the southern Murray Darling Basin, where 14 per cent of all trades are by companies and individuals who don’t own land. 

The company owns entitlements and allocations to 69,700 megalitres of water in the southern Murray Darling Basin, but has no land to use it on.
The company told the ASX its "primary objective" is to "generate annual income through capitalising on the increasing demand for scarce water resources".
 
The company's Director of Water Assets Alister Walsh told an investor website that Duxton is "invested in the accounting of water”.
 
The ACCC has been asked to inquire into the water market in the southern Murray Darling Basin, where 14 per cent of all trades are by companies and individuals who don’t own land.
 
“If I get something back from the ACCC that tells me there is inequity, that there is an imbalance in the market place, it's our responsibility to act,” Minister Littleproud said.
 
Federal Water Minister David Littleproud said it’s the government’s “responsibility to act” if the competition watchdog concludes commercial water speculators are driving up prices.
 
Federal Water Minister David Littleproud told 9News it’s the government’s “responsibility to act” if the competition watchdog concludes commercial water speculators are driving up prices. (9News)

Farmers are furious at the companies who they believe are artificially inflating the price of water, while they are financially crippled.

“The rich will get richer and the rest of us will have to make our way doing something else,” Victorian dairy farmer Kirsty Dalitz said.

The Dalitz’s were forced to put their dairy farm in Yalca, near Shepparton, up for sale due to the “ridiculous” price of water.

"We are just going broke," Steve Dalitz said. “I can't afford it, but if I don't water, everything I've started just dies.”

The long dry spell, coupled with government water buy backs and the growth of crops like cotton and almonds, has driven the price of water in the southern Murray Darling Basin to its highest price since the Millenium Drought.
 

Duxton Water told 9News the company owns one per cent of water rights in the southern Murray Darling Basin, and is in the business of working and partnering with farmers.
 
“Duxton Water does not speculate. It is a long-term investor of water rights and a long-term supplier of water with the aim of ensuring the long-term viability and sustainability of agricultural production in Australia,” a company spokesperson said.
 
It also welcomed an inquiry by the ACCC but said the “review will need to encompass both demand and supply factors currently in play”.
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