WATER Minister Tim Holding has given Sunraysia irrigators some minor relief from Victoria's 4 per cent cap on the seasonal water traded out of their districts.

Mr Holding gave Merbein, Red Cliffs and Robinvale irrigators the opportunity to sell a combined total of 1000 megalitres of high reliability water shares this despite each having reached the 4 per cent cap this season.

The irrigators have been given the option of tapping into 1000 megalitres of unused capacity under the cap in the former First Mildura Irrigation Trust district.

Mr Holding said districts that had already reached the 4 per cent limit on permanent trade of water outside the area have been grouped with a district that has not yet reached the limit

``The Brumby Labor Government understands the financial distress for many farmers in Sunraysia hit by the collapse in wine grape prices and contracts,'' Mr Holding said.

``We are finding a balance between providing Sunraysia irrigators with more flexibility to trade water for cash flow while protecting the local economy and preventing huge volumes of Victorian water being traded permanently out of agricultural production in the state.''

Mr Holding said by changing the trading rules, irrigators in Robinvale, Redcliffs and Merbein would be able to share in the space available under the Mildura District limit.

``More farmers in the Robinvale, Redcliffs and Merbein districts will now be able to enter the water market,'' he said

Victoria has maintained a 4 per cent limit on permanent water trade out of irrigation areas since 2002 to help communities adjust over time to the social and economic impacts of large volumes of water leaving irrigation areas.

Victoria has agreed to phase out the 4 per cent cap from 2011 depending on a review of the irrigation modernisation program.

The changes to water trading in Sunraysia will come into effect from close of business today.

The decision gives many of the districts' smaller block irrigators the chance to sell some of their water to the Federal Governnment, under its $3.1 billion water purchasing program for the environment.

However they must wait until the second and third rounds of the Federal Government purchasing program, as the first two-week tender closed at 5pm today.