THE lifting of restrictions on prime River Murray farmland has coincided with the introduction of lucrative federal government grants to prompt a wave of interest in small-area farming, but those in the know are urging caution.
Plots of land left dormant under a five-year moratorium imposed by federal Labor's $57 million Small Block Irrigators Exit Grants package in 2009 will soon become available for productive purposes.
As a key plank of the former government's Murray Darling Basin rescue plan, the grants were provided to growers who agreed not to irrigate their land for at least half a decade.
The moratorium starts to expire on properties from this year, but the gradual release of the 2747 hectares of exit-block land would turn into a veritable flood should the federal government go ahead with plans to lift the entire ban ahead of schedule.
On the orders of Parliamentary Secretary for the Environment Simon Birmingham, the Department of Environment is reviewing the impacts of exit grants and any potential changes that can be made.
Mr Birmingham pointed out that with the last of the grants awarded in 2011, some land would not be made available until 2016.
In announcing the investigation, he said the properties had become havens for pests and weeds, posing problems for neighbours.
"I think that it has created a problem for a lot of irrigation districts where blocks are looking like wasteland rather than productive land, and we really need to address that and return those lands to productive use," Mr Birmingham said.
"But I'm conscious that there are implications in terms of conditions placed on the grants, legal actions that may or may not have been taken to enforce the grants up until now and the precedent it sets for other exit grant packages."
Berri's Riverland Lending Services managing director Jeff McDonald is not convinced that lifting the ban would be worth the effort.
He has advised a number of people looking to develop the affected land, and claimed the time required to bring land back to productive capacity meant most of the properties would be unaffected by any repeal.
"I was anti-exit grant when it was brought in, but I don't see why you'd bother changing it at this point," he said.
Mr McDonald was not convinced there was real demand for such properties.
Interest in such projects fell away following a dramatic drop in indicative prices for grapegrowers in January.
"It's typically too small acreage for almonds, easy peels and so on. You need nearby complementary stuff to make that viable."
Mr McDonald said the low prices had dissuaded most interested parties, with the remaining demand artificially generated by a separate grant package - the state government's $240m Irrigation Industry Improvement Program.
The program offers funds to irrigators to improve water-use efficiency and the productivity of farm businesses.
* Full report in Stock Journal, February 6, 2014 issue.
