Evaluation of the economic feasibility of water harvesting for irrigation in a large semi-arid tropical catchment in northern Australia

There is interest by governments and private organisations in exploring alternative models of irrigation in parts of northern Australia where there has been little irrigation development to date. One alternative is ‘water harvesting’, which is defined here as the practice of pumping or diverting water during streamflow events and either applying directly to a crop or (more commonly) holding water in off-stream storage on a property for later use. This study presents a detailed farm-scale bio-economic analysis of water harvesting using river system modelling to represent the interactions between farm-scale returns, reliability of extraction and scale of development. In doing so the farm-scale viability of irrigation within a whole of catchment is assessed, and uses the Flinders catchment, a large, semi-arid tropical catchment in northern Australia as a case study. Extraction reliability varied spatially across the catchment and decreased with increasing total catchment extraction. The farm-scale profitability of water harvesting enterprises was found to be particularly sensitive to fluctuations in price, reliability of water extraction, discount rate, cost of storage and timing of crop-failure years. For crops requiring off-site processing, the existence of local processing facilities was a major factor. This study also highlighted that for irrigation developments based on water harvesting there is potential for serious mismatches between the timing of streamflow and time at which planting must occur.