Disapproval Arises over Rising Water Prices
In the agricultural heartland of Alentejo, Portugal, farmers' associations are voicing their opposition to a potential increase in the price of water from the Alqueva irrigation system. The system, managed by EDIA, is crucial for the region's agriculture, supporting significant agricultural activities and generating substantial tax revenues for the State.
The primary concern of the farmers is the potential impact of increased irrigation costs on the viability of their operations. With water already accounting for a significant portion of their direct production costs, any price hike could make many farming operations unviable. According to the Young Farmers' Association (AJAP), water could represent 20% to 35% of direct production costs per hectare for producers of annual crops such as maize, tomatoes, vegetables, and forage.
José Salema, President and CEO of EDIA, has been involved in discussions about water pricing. However, farmers have expressed clear disapproval of any price increases. Luís Mira, Secretary-General of the Confederation of Portuguese Farmers (CAP), has stated that producers should not be made to pay for EDIA's operational deficit. AJAP's director-general, Firmino Cordeiro, has reiterated the organization's strong opposition to the price increase, stating that any rise in costs must be "technically justified, economically sustainable, and socially balanced."
EDIA's operational deficits have been a topic of discussion, but the State does not face the same financial difficulties. A study commissioned by EDIA and conducted by EY earlier this year confirms that the revenues generated by Alqueva surpass EDIA's losses. The Government has dismissed the idea of an increase in the price of Alqueva water.
Salema has suggested a differentiated pricing system based on crop type, but this proposal has been met with rejection by the farmers' associations. Luís Mira believes that any operational deficits at EDIA should be compensated through transfers from the national budget, not through additional burdens on farmers.
The agricultural activity supported by Alqueva contributes significantly to the State's tax revenues, and any financial strain on farmers could have far-reaching implications. The farmers' associations are adamant that any increases in water prices must take into account the essential role that affordable irrigation water plays in supporting agriculture in the Alentejo region, where Alqueva water is vital.
- The farmers' associations in Alentejo are not only concerned about the proposed increase in water prices from the Alqueva irrigation system, but they are also critical of the possibility that these costs could be attributed to compensate for EDIA's operational deficit, echoing sentiments expressed by the Secretary-General of the Confederation of Portuguese Farmers (CAP), Luís Mira.
- The escalation of irrigation costs could have a substantial impact not only on the local farming industry, but also on the general finances of the State, given that agricultural activities supported by Alqueva contribute significantly to the State's tax revenues; hence, any increase in water prices must be carefully considered and justified, as demanded by AJAP's director-general, Firmino Cordeiro.
