Damian Park made this demand curve from bids for water from this recent auction of water [pdf description]. Madera Irrigation District had some to sell and buyers were paying HUGE price (winning bids in Buena Vista's Feb market were $1100/af).
Bottom Line: Prices go up when demand is high and supply limited. Farmers would be better off with more markets and auctions, so paperwork should be minimized. (Regulations should ensure that farmers are not selling "community" water.)