The chief executive of Select Harvest, one of the largest global corporate almond farmers, has expressed concerns about future water security.
Select Harvests is Australia's largest almond grower and processor, and is the third largest grower worldwide.
Managing director and chief executive Paul Thompson, speaking at the Waterpool Water Summit, Moama, hit out at what he said were "irresponsible growers.
While most almond producers were doing the right thing, Mr Thompson was critical of some growers.
"An irresponsible grower is someone who is putting in almond orchards and doesn't own any water," Mr Thompson said.
"They are equally as speculator of water, as a person who is speculating in water, itself."
Water, and infrastructure, represented 20-30 per cent of Select Harvest's costs.
"We have no plans for future development in Australia," Mr Thompson said.
"That's not because of lack of land, but lack of water, and water security in particular."
He told the summit Select Harvests owned entitlements, bought water on the spot market, and used products, such as long term leases and carryover.
Select Harvests used to be more public about the amount of water it owned, or acquired.
'We have become more opaque about that, which does cause some of our investors concern," Mr Thompson said.
He said Select Harvests had no issue with what he called sophisticated investors, entering the market
"We are concerned about their entry into the annual allocation market, which is a different story," he said.
Select had been deliberately buying assets in different regions, to mitigate against problems caused by weather, pests and diseases.
Plan concerns
The ASX listed company had $700 million in assets, in Victoria, NSW and South Australia, with 7500 hectares under cultivation.
The company had a large processing facility in Robinvale, which took the hull and shell off the almond, to create paste, milk, meal and sliced or diced almonds.
"Anything you want done to an almond we have the capability to do," he said.
"We are adding value in Australia and exporting into a global marketplace."
About 80 per cent of the company's almond production was exported.
Mr Thompson said while Select Harvests supported the Murray Darling Basin Plan, the company had concerns around its execution.
"There is a disconnect between the theory of the Murray Darling Basin Plan and its original intent, when they say it's about supply and demand.
"I have no objection to environmental water, but have concerns around (the government) taking 25 per cent of the water.
"That was always going to create price pressures, as they took 25pc of the water, but didn't take out 25pc of extraction rights."
Markets had evolved significantly since the introduction of the Plan.
"In some parts the market needs to have the egg unscrambled, just as the trading market and real time activities of the internet has changed the way in which we trade."
The government had caused the greatest price spike in the permanent entitlement marketplace, by "scrambling to buy water," to meet environmental requests..
"It's not just about the fact there is less water dropping from the sky and less water flowing down the rivers, it's been heavily influenced by the increase in permanent crops in the (Murray) valley," Mr Thompson said.
"And you can't deny the fact that government policies and interventions have also had a strong influence on it."
ACCC Submission
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Select Harvests would be putting in a submission to the Australian Competition and Consumer Commission inquiry into the water market.
"The ACCC inquiry is a good opportunity to address the current issues, impacting water markets and take advantage of new technology, plus realign community expectations."
The company's submission would centre around five key points; the growth and entry of non-irrigator sophisticated financial investors, the lack of accurate, comprehensive and timely data on market activity and the need for transparent and robust market rules.
Select Harvests would also be asking for water brokers to be regulated, similar to stock brokers, and wanted to see increased collaboration between federal and state governments, to harmonise environmental flows, carryover and intervalley trading.
He said the ACCC must make sure sophisticated investors did not have an unfair advantage.
"I do believe there are effective markets being run, where the competition is equal to that in the water market place, and the one I call on is the ASX," Mr Thompson said.
"It has good guidelines to make sure people are not breaking the rules."
There should also be increased collaboration between state and federal governments, and there may need to be a national water register.
"Different states have different strategies and different policies," he said.
"I don't think we need to continue to make the mistakes we have made in the past, because of state policies."