Except modern conventional agriculture requires two things: 1) lots of sun, and 2) lots of water. Those two items rarely are in the same region at the same time.
It makes a lot of sense to have agriculture growing in desert regions as opposed to wet/dark regions. It is far easier to deliver water to a desert than it would be to deliver more sun to a shady region.
A market price for water doesn't make a lot of sense, if you are thinking about that market price being the same that consumers pay. Urban consumers are paying price X because it is supporting the infrastructure and other resources used to deliver the water to their individual houses.
Farms aren't using any of the urban infrastructure to get their water. They have a whole 'nother set of pipes (where I lived it was a river, and you bought your own water pump to fill your own set of pipes, private infrastructure per farm), entirely different usage patterns, etc... I can see value in have some more market forces influence the price of agricultural water, but it would never make sense to have it be the same set of market forces that influence consumer water prices.
Plus, there are some goods that we intentionally subsidize, because the forces don't exist in the market, or the market would do a poor job of delivering the outcomes we want. Keeping food/power costs down, are often things that get direct or indirect subsidies because it is beneficial for so many people.
It would be an interesting experiment though, seeing if people would really want something like avocados if they cost 10 bucks because water was pricey.