Water trading is the process of buying, selling or exchanging rights to water.
Trade can be a permanent transfer of ownership of a water entitlement (an ongoing right to water), or trade of an annual water allocation (the physical water available in a given year).
Water markets in the irrigation systems in northern Victoria and the Murray-Darling Basin are well established and are commonly used by entitlement holders to manage water for irrigation, towns and the environment.
In other regions in Victoria, while trade is possible, there are not always well-established processes.
Whether they be dairy farmers, almond growers, beef farmers, water corporations or environmental water holders, all market participants are subject to the same State and Commonwealth trading rules.
Under the Victorian Water Act, we can buy, sell or exchange water to meet environmental needs.
To find out more see the annual Water Allocation Trade Strategy. It provides information about how and why environmental water might be traded in the following financial year.