 Now, as with the other session, I'd encourage everyone to jump on to the chat line early if you can, that you will have just come on with Stuart and Simo, so that you can get your questions in there. The plan will be that I'll roll through some slides on emerging water market products, and then at the end, basically, turn to those questions, ask you to unmute if you've asked a question, and ask the question so everyone can hear it, and then we'll work it through from there. So look, I hope you're enjoying the session. We've certainly had some good questions in the last half hour, so looking forward to some further questions in this half hour. So in this session, I'm just going to have a chat about, it's a bit more of a higher level and more about the mechanics of things, whereas the session you, I presume, have just come from would have been, it was more about some of the case studies and the options that you have available and how that can play out from, particularly, a financial perspective for you as a business. So what products are available for me to manage water market risks? Well, first question in that is, what are the risks of water market products and what are the risks that you're trying to mitigate as a business? But let's first of all talk about some of the risks of water market products, because in order to manage risk, you need to understand what are the risks that come and that are associated with water market products? And I tend to, we tend to divide them into four broad categories. There's allocation risk, pretty obviously, that the yield is not sufficient to meet watering requirements and that can be in the longer run, but it can also very much be in the shorter run as well. There's rules-based risks around the ability to have the water delivered. And we spoke about some of those risks in the previous session, particularly around the presence of trading limits. And then there's also spill risks. And I want to talk a bit about this particular risk as part of this session, because you need to be mindful of what happens if a spill event occurs and the consequences of that if you're using something like carryover parking. And then obviously there's price risks. So you might be looking to manage price risk. And so you need to take into account the cost of entering either the temp, the allocation of the permanent market, to meet your water requirements and thinking about how much that water costs compared to what is your willingness to pay. So what sort of products are out there? And in this session, as we mentioned in the last one, we're looking more at some of the, I guess, more developed products. So the first two really are temporary water and permanent water. Temporary water is typically always available on the market. But as we've witnessed this year and as was witnessed during the millennium drought, price risk can be quite significant in years of low water availability or resource availability. And so we saw water in some zones go above $1,000 per meg in this past water year. And so that's pretty expensive water. Unfortunately, there are other times when it's cheaper, but that's usually when the demand or always when the demand is lower for it. Equally, if you start looking at permanent entitlement, prices have been at historic highs across much of the southern Murray-Darling Basin, particularly for higher reliability entitlement types. So you're going to need capital, you're going to need access to capital to buy more. And there's still an allocation risk in dry years, depending on the type of entitlement that you've purchased. The nature of that risk and the extent of that risk will also vary. So let's talk a little bit then about secondary products that may be of interest and attractive for you guys to think about. As we spoke about before, let's do it a little bit more slowly. There are three broad products that are most prevalent in the market. There are others, but we're just going to talk about these three for the purpose of today, today's session. The first one is an entitlement lease. This is where an entitlement holder, lessor, transfers access of the entitlement to a second party known as the lessy for a period of one or more years, often three or more years in reality. And at the end of the period, it basically reverts to the lessor. Another type is forward allocation trades. And firstly, I should note that on a lease, one thing you need to be really mindful of is that under a lease arrangement, the lessy gets announced allocation available against that entitlement type. So if allocation is low, they get low allocation. If it's high, you get high allocation. But basically your access to water is a function of the amount of allocation that is being announced against that entitlement type that you have taken out a lease for. Forward allocation trade is basically allocation water that's traded with a future delivery date at an agreed price. It might be this water year, or it might be next year or it might be multiple years. And it can be a really good way of de-risking your access to water next year. But it comes to the price tag as we'll talk about on the next couple of slides. Thirdly, and I'll talk about this further in this carryover parking, certain types of entitlements can allow unused water to be carried over year on year. It's not all. So you would have seen that table earlier in our slide presentation, but many have the ability to facilitate carryover of water from one year to the next. In a carryover parking contract, as it's known, party with excess allocation, places, rent space from a holder that's got the carryover water. And the park allocation basically is put there for a period and then returned, typically in the following water year because you're looking at parking across water years. So there are various timeframes that are involved in these. And I guess temporary trade is obviously very much immediate in terms of its timeframe as is permanent in terms of when you're buying the entitlement. Carryover parking tends to bridge a water year. Whereas leases and forward allocations can be arrangements that are put in place for multiple water years potentially. What can these products do for me as a buyer or a seller? Well, forwards give you certainty of volume. They're available. You've locked in the price. You've locked in the volume. They're efficient risk management tool. And you can effectively look to lock in future returns with them. Leases, long term solution for both parties. You get the water security that comes with it. It comes at a lower capital expense or expense to the business. And it gets a financial return to the party that is the lessor for the arrangement. And as we spoke about before, carryover parking can be an affordable product with good benefits to move water from one water year to another. But you've got to be really mindful about who bears the spill risk. That really depends on the contractual terms and type. And I'll talk a little bit about that further. Let's talk about some of the things to think about where this is concerned, though. Let's have a look at forward water and entitlements and leases and carryover parking. Obviously, if you're buying forward water, there's typically a price premium that comes with it compared to current temporary prices. So what you can see here is if you're looking at Big Murray Zone 7, the spot price, $250 a mega liter. If you're looking to buy forward water at this time, it's about $500 per mega liter with it being delivered from July 2020 onwards. So you're paying a price premium to know you will have access to that water. If we look at entitlement leases, as I mentioned before, terms are usually from three years and up. And things you need to think about is what do you think the average temp water price is going to be over that time and what will the reliability of that entitlement type be? So zone 7, you might be looking to get zone 7 water for high reliability. Lease price at the moment could be in the order of $350 per mega liter, three years and up. And the spot VWAP over the last four years is averaged $310 per mega liter. So need to think about what's the cost trade off with different products where this is concerned. But noting that that's an average price. And year on year, we've seen quite considerable volatility. And looking forward to you need to work out what is appropriate from your risk perspective. Carrier of the parking typically cheap. $50 to $60. Let's say if you're parking on a lower reliability entitlement type. But you've got a, if you don't have the water, you're going to have to buy it off the temp market and you've in Victoria, you'll lose something or losses around 5% through evaporation. I'll talk about that again further. So a little bit more next couple of sides on carryover. So you need to think about what's possible and where we have a look at New South Wales. These allows Murray general security. We tend to suggest this isn't financial advice, but we suggest you think about parking on lower reliability entitlement types so that you can reduce your risk of spill. Up to 50% of the entitlement can be put on carryover in Murray general security. The total cannot exceed 110% of entitlement volume. And if it goes above that, it's lost. General security, you've got 30% carryover allocation. It goes above 100%. It's lost. So it's really important to know who's going to bear the spill risk. Your parking on this carryover in Murrumbidgee and it goes above 100%, who's going to bear that risk under your contractual arrangement of the moment? Is it you as the party who is taking out the arrangement and having your water parked or is it the counter party that is bearing that risk? And there isn't a standard arrangement in place for that. That's subject to what is negotiated. Further on carryover parking, we look at Victoria. So 100%, unlike the others, 50% and 30%. But if you exceed 100%, then it goes into another account called a spillable account that can only be accessed when there's a low risk of spill for humed and less than 10%. That can take a few months to occur. So if your water is in the spillable account, you've got to wait for the declaration to occur before you can get access to it. You're also going to lose water due to evaporation and other losses. And given high reliability entitlements are generally high yielding, similar to high security in New South Wales, you've got a high spill risk than you would in the case of low reliability. So in essence, it's really important when you're thinking about your options, if you're thinking about parking water, carryover parking for next year, that you're mindful of what's possible in the state, and where what risks can present and who who carries the risk. So this is, I guess, some concluding slides. And then I hope there's some questions that might come from the group that we can then talk through. But basically, I guess, from what we observe access to interstate markets can give you significant benefit. There's opportunities to access carryover capacity or allocation markets from interstate. You obviously need to think about things like deliverability. Can you get allocation water delivered to your SA account is going to be a function of what's happening with the IVTs. The cost of products, which one's right for you from your perspective is also really important. Risk of spill is really important as well. You need to understand what the risk of spill is, and who's carrying that risk who bears the risk in that circumstance. And then you should also always be mindful of what's the broader availability output. If there's a shift to a wetter pattern or a drier pattern, climatically, then you need to be making an assessment based on the evidence that you can get. And there's lots of different information sources around that to make your judgment. The last thing that was a really good question raised in the last session that I also flag in this is that obviously, there's a counterparty risk with these sorts of arrangements, because they're not completely standardized. And if you enter a forward arrangement, for instance, there is always a counterparty risk present that if you purchased it, that you paid the money, and then how do you know you're going to get the water? Now, that's a clear and present risk that needs to be managed through contractual terms. I guess one of the participants in the last session said, have we heard of any? Are we aware of any from some of the work that we're doing with water flow and advisory we do on markets? We're not aware of this emerging as a risk at this point in time, because I guess in the engagements that we've done, that we've not, basically, the sellers have deemed it as being really important that they honour their arrangement, because that's part of their reputation in the market. And some of these sellers are quite big players, and they want to see some of these emerging markets really develop and mature over time. But nonetheless, counterparty risk is present and something that you just need to be mindful of that you have a line of site to who the counterparty is, can also be mitigated to some extent, if you're working, obviously, through reputable broken entities, and the like, who have considerable expertise in these, and can, I would expect, help you to understand the nature of that risk and other risks that might be present. So that comes that's the end of this discussion on emerging products. We've now got about 10 minutes or so to, for you guys to ask any questions, just going to open up the chat and see if there have been any questions posed. Or if you've got a question, raise your hand and you can feel free to unmute. So I can't see any questions in the chat. I'm just going to check with my colleague if there's any questions present. No, I can't see. There's nothing in there. Okay, now we've got a question here from, is it Tamara? Tamara, did you want to unmute and ask the question so others can see it, can hear it? Is it something around? Is it fair to say carryover risks? Maybe we're having trouble hearing Tamara at this stage. The question is, is it fair to say carryover has higher risk attached, i.e. SA allocations above 80%, than Vic lower reliability parking, any comments? Look, I think it is fair to say that there is something of a higher risk attached to it than parking it on a Vic lower reliability product. And the reason for that is because in South Australia, you're benefiting from a product that actually has a really good reliability and a really good likelihood of getting a high allocation in any given water year. And history has shown that that it has amongst the highest security of the entitlement types across the southern basin. Whereas low reliability water really only starts getting allocation in periods of time when it's very, very wet. And so the spill risk attached to a Vic lower reliability parking arrangement is, in my opinion, lower than it would be putting it on something like SA class three, or even putting it on something like higher reliability or high security water interstate. So I would always suggest that you look for options that are on lower reliability products to minimize and reduce that risk. Tamara, I hope that helps answer your question. Are there any other questions from the group? Feel free to unmute if you have a question, or have I answered all your questions, or it's time to head for a cup of coffee. Well, it doesn't look like there's any more questions. So I would suggest that I'll just see if there's any more questions from pre registration that might have been answered. I think we've answered all those, though. I'll just take one of my colleagues prompt me, which is a good suggestion. No, I think we've done all of those sorts of questions there as well. Obviously, you need to think about things around your allocation and what's what's available under your allocation and what you're expecting to get next quarter year. And then in terms of what might be the amount of water that you're parking and how you get that delivered. But obviously, if you've entered a parking arrangement and that water has been moved off and then you get your allocation against your existing license, then you should still be able to get access to that water and bring it in when you need it or you might decide to park it for a longer period of time if you get to that point if you've got ample water. Okay, so lastly, I just do a quick plug for water flow and then I'll wrap this up. We've obviously launched a product called Water Flow into the market. And it's giving you free access to all sorts of water market information. We're bringing together information from all different sorts of websites. There's over 30 different locations. And the most important thing is that we got a grant from government to do it so that we could provide the service to you guys for free. When we also did the exercise as well, we've we're doing it in a way that you get access to clean data as many as we would be aware. There's a lot of noise in water market data. And so we've done a we go through a process to to remove that noise so that you can get a pretty clear signal to what actually is the price in different parts of the market. And there are features in there as well if you want to do searches around forwards and the like if we're picking up forwards from data providers that you'll be able to see those as well. There's a question here on water restrictions. I'm not sure I follow the question that's more of an urban issue than an allocation issue. I think the question is about water restrictions. Do we get the restricted amount when the water comes back? What happens in these rural markets? It's Jen who's asked the question. Oh Jacob, but I'll just ask if we're on say 10% in South Australia, can we bring back our parked water? Can we only use 10% or is that subject to the same water or can we use if we've parked 10 megs? Can we use 10 megs when it comes back? You can use the 10 megs subject to deliverability Jen. That's the view. So you've got 10% but you need more. That's that's where parked water is of benefit to you because subject to it being able to be delivered obviously and that's around the IVTs and those sort of things but not you can bring it back on. It's your water and so what happens is you basically you see a temp trade back to you which takes another 10 megs onto your license and then you can bring that back onto your farm. So that's where that's how parking works and that's the whole idea here is if you've only got 10 or 20 or 30% but you know that you've got money so you've got water left from this year that you'd like to have available next year parking it as a means of basically knocking it away so that you'll then have it at the start of next year available to you. And from the other seminar as far as I can work out you can use then you can use 110% of your allocation your 100% from this year plus your 10 megs that you bring or whatever it is. Yes. Yes. Yep. Thank you. A pleasure. Look thanks everyone for your time today. I hope the session has been has been useful to you. It's been a pleasure to bring this to you and to work with the team at HRSA in bringing all of this together and yeah we'll be sending an email out to all of you when the slides are available and the YouTubes are available and look at this time of some crisis in the world I wish you all the very best and I hope you all stay well. Thank you for your time.