Ploughshares into profit

The prices of agricultural land continue to grow and were up by 33 percent per hectare in the fourth quarter of 2007 compared with the same period in 2006, according to the most recent data on state-owned land from the Agricultural Property Agency (ANR). The most expensive regions in Q4 of 2007 were the Małopolskie, Wielkopolskie and Kujawsko-pomorskie voivodships.

Before Poland joined the EU, the price of farmland was under zł.4,000 per hectare. There was little demand for it and plots often remained unsold for long periods of time. Prices grew steadily after 2005, however, and last year saw dramatic rises, with the average price in Q4 2007 reaching just over zł.11,000 per hectare.

The trend isn't spent yet, either. Dziennik daily reported a record price for agricultural land in the Zachodniopomorskie voivodship, near Szczecin, where a plot was sold for zł.2.34 million per hectare. 

"People have begun to see agricultural land as an investment," Grażyna Kapelko, ANR spokesperson told WBJ. "In addition, farmers are encouraged by subsidies and want to hold on to their plots. There's less and less agricultural land to be sold - the agency currently has 345,000 hectares left. There are also regions where there's virtually no available state-owned land left," she added.

Moreover, in the Wielkopolskie region "much of the land has been claimed by former owners and these claims are in the process of being assessed," according to Kapelko. However, there is also limited availability in the Podkarpackie and Podlaskie voivodships, though this is mainly due to the poor quality of the land.

Prices will continue to grow, driven by increasing interest in plots that can be relatively easily converted into non-agricultural land, according to analysts quoted in the Wall Street Journal Polska. Analysts also anticipate that less attractive land will become more popular among potential buyers.