The children are paid low wages and subjected to dangerous conditions in violation of international labour laws, working on settlements that are themselves considered a violation of international law, a new report from Human Rights Watch has found.

During peak harvest periods, some children reported working up to 12 hours a day for more 60 hours a week, starting as early as 5.30am, the report found. Those who worked part-time or on weekends were often exhausted when they were at school, their teachers told Human Rights Watch.

Human Rights Watch interviewed 38 children and 12 adults who work on seven settlement farms in the Jordan Valley area. They said were employed through unwritten agreements with Palestinian middlemen working on behalf of Israeli settlers.

All of the Palestinian adults and children interviewed earned far less than the Israeli minimum wage, which is 23 shekels ($7.50) per hour for adults and between 16 and 18 shekels per hour for children. Most earned between $20 and $25 per day while some children earned as little as $17.50 for a full day's work.

Most of the settlement farms are in the Jordan Valley, a traditional centre for Palestinian agriculture that is under Israeli military occupation.

Israel has allocated 86 per cent of the land in the Jordan Valley to the settlements and provides vastly greater access to water to the settlement agricultural industry than to Palestinians living in the area, says Bill Van Esveld, a Human Rights Watch researcher for Israel and Palestine.

"The worst cases we found were the very young kids," he told Fairfax Media. "We spoke to a 13-year-old who had dropped out of school and was working full time on a settlement farm with no protective equipment, spraying pesticides.

"His family used to be farmers but now they have very little access to their land or to water for farming - they are impoverished and forced to work on the settlements."

Almost all the Palestinian children Human Rights Watch interviewed said they had no alternative but to find work on settlement farms to help support their families. "So what if you get an education, you'll wind up working for the settlements," one child said.

The children reported suffering nausea and dizziness, with some telling Human Rights Watch they had passed out working in summer temperatures that often rise above 40 degrees Celsius outdoors and are even higher inside the greenhouses.

Others say they experienced vomiting, breathing difficulties, sore eyes and skin rashes after spraying or being exposed to pesticides, including inside enclosed spaces, the report found.

A 2007 Israeli Supreme Court ruling found Israeli labour law protections should apply to Palestinian workers in settlements.

"The main problem is the Israeli authorities - no one is checking as to how these children are being treated," Mr Van Esveld says.

The Israeli Defence, Economy, and Labour ministries all say that they are "studying" how to apply more labour protections for Palestinians working in settlements, but in the meantime no government agency has a clear mandate to enforce regulations.

A spokesperson for the Foreign Ministry said: "The report is currently being studied by the relevant Israeli ministries. We will react following a thorough analysis of the report."

"The settlements themselves are unlawful . . . and unsurprisingly the Israeli settlement regime has led to nasty exploitation of children's rights, so we are saying to countries and businesses [that deal with settlement products] that this is something they must consider," Mr Van Esveld says.

The asparagus, tomatoes, eggplants, sweet peppers, onions, dates and other crops are mostly exported to the United States and Europe, where there has been fierce debate about the correct labelling of the origin of settlement products.

The European Union has moved to exclude Israeli settlement products from the preferential tariff treatment it provides to Israeli goods, Mr Van Esveld said, while EU member states have issued advice to businesses regarding the legal, financial and reputational risks of involvement with settlement trade.

The US, however, continues to grant preferential treatment to Israeli settlement products under the US-Israel Free Trade Agreement.

"Much of the debate around settlement produces in Europe has been around labelling as a consumer protection issue," Mr Van Esveld says. "We hope that by focusing on the circumstances of the production of settlement agricultural products, we can also highlight the exploitation of children and the abuse of Palestinian adults working in the settlement sector."

The World Bank estimates that discriminatory Israeli restrictions on Palestinian farmers' access to land and water in the occupied West Bank costs the Palestinian economy more than $US700 million ($911 million) each year, resulting in poverty rates as high as 33 per cent in the Jordan Valley.