THE value for irrigated cropping assets across the country are highlighted in a new report by valuation company Herron Todd White.

Broadacre land suitable for cotton production stretches from Deniliquin in the Riverina region of southern New South Wales to Emerald in Central Queensland, and in more recent times to far north Queensland’s Gulf and the Ord River Irrigation Area in Western Australia’s Kimberley region.

HTW director Will McLay said as land and water in these long-established growing regions become scarce, cotton farmers have turned their attention to new geographic regions.

“These areas benefit from more secure water and, on face value at least, are more affordable,” Mr McLay said.

“However, they come with seasonal and logistical challenges.”

The irrigation areas of south-west NSW adjoining the Murray River represent the most southern extremity of the cotton growing area of the state.

Mr McLay said the hype that underpinned buyer interest for irrigated cropping land tied to four consecutive good seasons, low interest rates, and strong commodity prices, has now settled.

In terms of recent sales, Mr McLay referenced a 484ha well-developed irrigation property, Boelgi, 20km north of Deniliquin, that sold in September 2023 for $8648/ha excluding water entitlements.

“Used for winter and summer cropping including cotton, the development included a lateral move irrigator and first-class laser levelled irrigation.”

Mr McLay said analysis shows $8350/ha excluding water for both the laser-levelled irrigation and land under the lateral-move irrigator, including the machinery.

In the far north of NSW, irrigated cropping land values in the Macintyre Valley and Border Rivers region include the 3145ha Booberoi, situated on the Macintyre River, 22km south of Toobeah, that sold for more than the $31 million asking price in October 2023.

Around 1028ha were developed to irrigation, with 522ha planted to cotton.

Mr McLay said the $31.5M sale reflected a rate of $6750/ha excluding water for the flood-irrigation area, or $25,000/ha including water.

Notable sales in 2021 include:

• 3473ha Wyadrigah, near Mungindi, sold for around $56M walk-in walk-out, or $29,000 per irrigated hectare;
• Fronting the Macintyre River on the Qld-NSW border and 20km west of Goondiwindi, the 12,168ha South Callandoon is a renowned producer of cotton, cattle, grain and pulses. It sold for close to $100M or around $38,000/ha irrigated;
• 2950ha Parkdale Aggregation, a cotton and dryland cropping property near Boggabilla, 15km south of Goondiwindi on the Whalan Creek floodplain, sold for around $40M or $22,225/ha irrigated; its 8932ML water entitlements alone were estimated to be worth in excess of $20M.

Mr McLay said irrigated cropping properties remain tightly held across Qld’s Darling Downs, particularly those with scale and significant water rights.

“Irrigated cropping values are making between $30,000 to $50,000 per irrigated hectare, well above other traditional growing areas due to location, proximity to markets, services and labour.”

Recent transactions include:

• August 2023: 306ha Glenavon, south-west of Dalby, sold for $12M;
• September 2023: 408ha Bethel, predominantly dryland, north-east of Millmerran, sold for $7.4M;
• December 2023: 611ha Oakleigh West, south-east of Dalby, sold for $24.75m.

In CQ, cotton is grown around Theodore and Moura on the Dawson River and in the Emerald area within the upper Fitzroy Basin catchment.

Mr McLay reports fewer farms in this location means sales evidence is infrequent.

• A small property south of Theodore recently sold within the irrigation district to show a rate of $7000/ha excluding water for the cropping component and around $25,000/ha when water and land are combined.
• In 2022, the 5976ha Central Queensland irrigation portfolio Cowal Agriculture near Emerald sold for around $120m or $29,000/ha irrigated.
• In 2023, the 3262ha irrigation, dryland cropping and livestock enterprise Kingower, 16km north-west of Emerald, sold for $28.5M, or $22,000 an irrigated hectare.

Northern Australia

As cotton land values reached $25,000 to $30,000 per irrigated hectare in established growing regions, Mr McLay said farmers sought to secure land in northern parts of Australia – particularly Qld’s Gulf, the Ord River Irrigation Area (ORIA) and scattered areas across the Northern Territory.

“The ORIA gained particular attention when some of the Quintis Sandalwood properties were offered to the market and purchased by southern irrigators for conversion to cotton farms.”

Mr McLay said the Quintis Farms have been sold for around $15,000 per irrigated hectare, including water, with the remediation costs to clear the sandalwood and re-establish the cropping land at around $5000/ha.

“This resulted in an irrigated farm with a value in the order of $20,000 per irrigated hectare, which is a $5000/ha to $15,000/ha discount on values observed in the southern markets.”

Mr McLay said the more affordable location comes with trade-offs.

“Producing a product in a remote area comes with additional operating expenses, increased seasonal and environmental volatility and lack of supporting infrastructure, although this is improving.”

 

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