Water markets, trading and investment

There are 3 water markets currently operating in Queensland:

• water allocation market – trading of registered water allocation titles
• seasonal water assignment market – seasonal assignment of water allocations and other entitlements
• relocatable water licence market – relocation of water licences from one parcel of land to another.

In the Cape York water plan area it is possible for holders of water licences granted from the Cape York Peninsula Heritage Area (CYPHA) reserve to assign water available under the licence to other persons (including non-Indigenous persons).

Establishing water markets provides certainty for the water industry, and helps create a stable and more attractive business environment. Trading water allocations can facilitate better decision making about usage and requirements. Over time, this promotes efficiency and can make businesses more profitable.

The benefits of trading water:

• helps people clearly see the value of their water as a secure asset, and obtain finance against its value
• encourages water-use efficiency—by allowing allocation holders to sell, lease or seasonally assign spare water
• enables holders of entitlements who want to stop production to sell their water without selling their land
• enables users to increase water supplies and improve the reliability of current allocations, and to switch to an alternative use of the water that may generate higher returns
• enables new industries to acquire water without jeopardising the environment, or affecting other water users.

This guide explains water markets and trading in Queensland.