STRATEGIC water buybacks will create an underclass of irrigators, some farmers say.

The Regional Australia Committee report on the Murray Darling Basin Plan recommended the Federal Government "immediately cease all non-strategic water purchases" to reduce impacts on communities.

The aim is to avoid the "Swiss-cheese" effect - where some irrigators sell out of a district, leaving those left to face increased shared infrastructure costs.

But Victorian Farmers Federation Sunraysia branch president John Piccirillo said the RAC approach would create irrigators who could sell to the highest bidder - the Federal Government - and others who could not.

"But you could sell outside the district to another irrigator, who could then sell to the Commonwealth at a profit," Mr Piccirillo said.

"For governments which advocate free markets, it's bulls---," Mr Piccirillo said.

Sunraysia had been devastated by drought, flood and damaged crops, he said.

"So the only thing left to sell is water - people are trapped on their properties here."

Mr Piccirillo said farm groups had not represented his interests during MDB debate.

Mr Windsor said irrigators "can't have it both ways".

"They were pleading for the Swiss-cheese thing to stop - now they want Swiss cheese, do they?" Mr Windsor asked.

However, he admitted the "strategic" approach would reduce selling options for some irrigators.

Sunraysia irrigator Bill McClumpha said growers who could not sell to the Government would have their borrowing capacity reduced as the value of their water dropped.

"We're growing half a million tonnes of wine grapes some years that are tipped on to the ground.

"That's not a food bowl, it's a massive disaster - irrigators are stuck in this Gulag ghetto," Mr McClumpha said.

Water Minister Tony Burke said there were many definitions of strategic buyback.

"The water market exists whether the Commonwealth is involved or not. Anyone who sells to the Commonwealth can buy from another irrigator and irrigators which might not be identified as strategic can still sell," Mr Burke said.