June 20, 2024

VIDEO: Weekly California Water Market Report

Ag Water Sells for $385/AF in Latest Transfer

The latest spot market transfer was completed for $385/AF between agricultural water districts in the San Joaquin Valley: The seller previously sold water for $375/AF earlier this year. Prices have increased because Central Valley Project (CVP) allocations for South-of-Delta agricultural contractors have remained relatively low at 40%, despite full reservoirs. The buyer anticipates paying higher prices this summer and has projected a range of $500/AF-$600/AF to its landowners for upcoming transfers of supplemental water.

Market participants continue to seek approvals for transfers: Several transfers are pending various regulatory approvals prior to physical delivery of supplies. As peak irrigation season rapidly approaches and project water allocations remain at just 40% of maximum contract amounts for many water users, a larger volume of transfer supplies will begin to move.
Recent sellers are primarily senior water rights holders with more reliable water supplies: Earlier this year, sellers also included CVP contractors needing to offload carryover supplies subject to being lost at the end of the water year.

Recent buyers are primarily agricultural water districts: These entities rely upon allocations from the CVP or State Water Project (SWP) to meet demands, and many are facing shortages this year.