Farm adjustment strategies to water-related challenges in the Murray-Darling Basin

The paper examines how Murray-Darling Basin (MDB) farmers respond to water-related challenges such as induced by climate change and environmental policy. This is a critical and ongoing aspect of farming operations in Australia’s largest watershed. Using the 2013 Regional Wellbeing Survey data, we show that irrigators and dryland farmers adjust their production processes and business models using a wide range of strategies, with irrigators adopting more strategies than dryland farmers and investment-related strategies being the most prevalent form of adjustment. The extent of adjustment depends on farm characteristics: large, intensive-farming units, on-farm income-dependent and annual cropping farmers were more likely to adapt among irrigators. Irrigators also generally place more importance on water-related strategies than output- and input-related strategies. Amongst dryland farmers, hobby farming, non-intensive-farming and perennial cropping units were more likely to adjust than other dryland farms. These empirical findings inform the important debate about developing and targeting adequate policy support for structural adjustment of farming operations in the MDB.