Cairns region home to both optimism and concern; HTW rural

The news that construction of a new irrigation dam near Cairns appears unlikely in the foreseeable future is cause for some concern, particularly given the high number of recent avocado and citrus tree plantings in the Mareeba and Dimbulah Irrigation Area, according to the latest rural report from valuation firm Herron Todd White.

This has impacted values in the region.

“The threat of drought, reduced irrigation water allocations, and the continued popularity of the avocado has led to change in northern horticultural industries,” the firm said.

"Fear of a repeat of the 2016/17 drought is never too far away from the minds of irrigators in Mareeba and the Atherton Tablelands."

Growers have adapted to water security concerns by constructing dams that utilise existing overland runoff and recycled irrigation water that would normally go to waste.

The benefit of these on farm dams is that they are not regulated by Sunwater, therefore the water is free from regulatory charges and the danger of reduced allocations.

To improve the efficiency of these dams, growers are also upgrading their pumping infrastructure with variable speed drives which have resulted in significant savings on their electricity bills.

The report also found that composting has emerged as a major new industry in the horticultural area in far north Queensland.

A large composting facility known as Shark Recyclers has been constructed in Biboohra, north of Mareeba.

It is reported to be a next-generation facility that is the largest licensed compost and soil conditioning manufacturing facility in Queensland.

This has helped growers in far north Queensland to expand into the profitable avocado sector. The recent sale of a mixed avocado and sugar cane property in the Mareeba district for nearly $60 million demonstrates the changing market.

Many growers have successfully transitioned from traditional mango and other tropical fruit crops to Shepard and Hass avocadoes, chasing the insatiable consumer demand for avocadoes.

Fruit prices in recent seasons have been very profitable with sales of going concern avocado farms very rare as growers have tended to hold on to these assets to take advantage of super profits.

Nearly 50,000 trees have been planted in recent years in the Mareeba and Atherton districts as growers look to cash in on continued high prices.

The full “Month-in-Review” Herron Todd White report for April 2020 can be found here.

Note regarding COVID-19

This edition of Month In Review had its topic defined in late February with submissions from our offices collated through to late March. During this period, shifts in the social and economic landscape due to COVID-19 became increasingly dramatic, as demonstrated by the varied information provided by offices over the course of three weeks.

This month’s residential theme on baseline property market drivers remains a common thread, and provides an indication of what influences to monitor as the property sector recovers post-crisis.