New water law will “halt expansion of Chilean fruit industry”

Chilean fruit producer federation Fedefruta has warned that planned changes to water laws put forward by the government of Gabriel Boric will have a detrimental impact on the country’s fruit industry.

Fedefruta president Jorge Valenzuela said the proposals “do not encourage investment in water efficiency” and “will stop fruit development in Chile”.

The changes, which were unanimously approved by the Senate last month and must now clear the Chamber of Deputies, are an attempt to reform in the allocation of water resources in a more sustainable and equitable manner.

They aim to encourage more efficient use through irrigation by subsidising the costs for irrigation projects of small farmers and indigenous communities.

But critics warn that they will remove incentives for the construction of new irrigation infrastructure in larger farms, which account for the bulk of Chilean fruit exports, as they will end the existing model of water rights, replacing it with authorisations of use that cannot be traded.

Valenzuela noted that a medium producer with more than 20ha will no longer have access to investment in irrigation. “This leaves 4,000 fruit companies without access to the instrument, which is equivalent to 82 per cent of the 375,000ha of fruit trees in Chile,” he said.

“And if we talk about cherry production, 66 per cent of the surface of this species will be without investment for irrigation.”

He further warned that the changes will halt investments in innovation in regions affected by drought where irrigation technification is most needed.

“The changes to the irrigation law go against technological development and the technical capabilities of innovation for the proper use of water,” Valenzuela said.

Attempts to modernise the Chilean Water Code – the legislation that controls distribution of the country’s water resources – began more than a decade ago. According to the Chilean Ministry of Public Works, agriculture is the largest user of water in Chile, consuming 72 percent of the total.

Currently, water rights are controlled by the Water Code of 1951, which defines water as a “national good of public use” and grants its use to individuals, a term which has been subsequently applied to both natural and legal persons.

The statute grants shares of water to individuals and companies, which may be held for the lifetime of the person or transferred to heirs or buyers. The volume of water associated with each share varies according to the source of the water and associated waterflow.

The new Water Code will have the biggest impact on the northern and central regions, where drought has forced companies to depend more heavily on irrigation.

If access to water in those regions is no longer guaranteed for the 20 to 30 years needed to ensure a return on investment in fruit orchards, producers will consider alternate crops with a shorter lifecycle or move further south where water is more abundant.