Today at the American Water Resources-Washington Section (AWRA-WA) annual conference, Richael Young, CEO of Mammoth Water, presented on “The High Costs of Water Trading: How Transaction Costs Price Out Smaller Deals That Could Lead to Big Wins for Agriculture.”
“Spoiler alert: It’s not the price of water that’s costing growers large gains from water trading. It’s the transaction costs associated with it,” Richael said about water markets.
High technical and legal standards often result in transaction costs that exceed the price of water itself, pricing out smaller deals that, in aggregate, could substantially improve agriculture’s resilience to water-related production risk. Richael discussed this and solutions that streamline water trades, including transparent, science-backed checklists.
“Water trading helps regional agricultural economies weather drought, moving limited water to higher-value uses that create more jobs, more food, and more tax revenue,” Richael said during her talk. “As a society and industry, we need to do more to make water markets affordable and accessible to our growers.”
For more resources on water markets and lowering associated transaction costs, please reach out to us. We’re here to help.
Update: We wrote a blog detailing how the public sector can help reduce transaction costs associated with water trading.