Variability in smallholders' irrigation water values: Study in North‐West Province, South Africa

Abstract

Capturing the economic value of water use is an integral part in the design of economic incentives and institutional arrangements that can ensure sustainable, efficient and equitable allocation of water. Irrigation water values of small-scale irrigators are however seldom studied and too little attention is paid to the determinants of the variability of the water values. In South Africa issues like the call for more efficient water allocation resulting from growing water scarcity, the approaching introduction of water charges for smallholders and the crucial role in rural development attributed to small-scale schemes, render this knowledge even more important. This study therefore first assesses irrigation water values at small-scale irrigation schemes in South Africa using the residual imputation method. Results reveal that, without input subsidies smallholders have difficulties to generate a profit from certain irrigated crops. This raises doubts about the capacity of smallholders to pay for water. The average economic value of irrigation water in this study is 0.188US$/m³. The water values are however shown to be highly variable. The General Linear Model shows that this variability can be mainly attributed to the crop choice and to the irrigation scheme design and institutional setting.

Value of Irrigation Water in Guadalquivir Basin (Spain) by Residual Value Method

“…They suggested that valuation of water should be a used to support the WFD implementation. Speelman et al (2009) assessed irrigation water values at small-scale irrigation schemes in South Africa and Esmaeili and Vazirzadeh (2009) utilized the same technique to irrigation in Iran.…”

Discharge‐based economic valuation of irrigation water: Evidence from the Teesta River, Bangladesh

“…Moore, 1999) data. The residual imputation method is on the other hand the most widely used deductive technique and was recently used by Speelman et al (2008, 2009), Lange (2007), etc. Young (2005b provides a comprehensive analysis of economic valuation techniques applicable to irrigation water.…”

“…Nevertheless, several studies (e.g. Faux and Perry, 1999;Moore, 1999;Turner et al, 2004;Butsic and Netusil, 2007;Speelman et al, 2008Speelman et al, , 2009 estimated the value of irrigation water applying different techniques of market and non-market valuation approaches. Hussain et al (2007) reviewed extensive literature on irrigation water valuation and provided the value of irrigation water for a number of irrigation projects in different countries over the globe.…”

Smallholder irrigation schemes in South Africa: A review of knowledge generated by the Water Research Commission

“…Payment for water on these 28 schemes, which was linked to WUA membership, was taken care of by the Department of Agriculture on behalf of farmers. The results of several studies have indicated that smallholders would face financial difficulties if they had to pay for the water themselves (Van Averbeke et al, 1998;Speelman et al, 2008;Yokwe, 2009;Speelman et al, 2011).…”