Report: Price of agricultural land in Romania up, but still lower than most European countries

The price of agricultural land in Romania has gone up in recent years, but is still 3 to 7 times lower than in most European countries, according to DTZ Echinox’s ‘Agricultural Land Investment Romania 2012’ report. In 2011, the price per hectare in Romania was EUR 1,972, up from EUR 1,700 in 2010, EUR 1,500 in 2009, and just EUR 927 in 2007. In 2003, the price was EUR 237, the lowest level in the last 10 years.

In Romania, the price of land varies greatly between regions. As a result, in the North-East and South-East regions of the country, the average agricultural land sale prices are of approximately EUR 1,500 to EUR 1,600 per hectare, while in other counties near Bucharest, the average land prices are around EUR 2,200 and go up to EUR 2,700 per hectare. “The DTZ Echinox study estimates that farmland price in Romania is likely to stay on an upward trend in the medium term. By the end of 2012, price per sqm of consolidated land plots in key locations, could register an increase of up to 20 percent compared to the market average. Given the sustained interest in such acquisitions, we estimate that transactions with farmland are likely to represent over 50 percent of the total land deals of significant value that are expected to be closed this year,” said Marius Grigorica, Senior Business Analyst, DTZ Echinox. Romania has an agricultural capacity of approximately 14.7 million hectares of land, with almost 10 million ha of arable land, 3.3 million ha of pasture, 220,000 ha of vines and vine nurseries, and 206,000 ha of orchards. Research performed in 2008 revealed that 6.8 million hectares are unused, according to the report. Moreover, about 90 percent of Romania’s agricultural land is privately owned. The amount of agricultural land available for purchase in Romania is currently estimated at some 500,000 ha. Forestry land in Romania is of around 6 million hectares - 25 percent of the total country area. About 4 million ha are owned by the Romanian authorities. The European average of forestry land is some 32 percent of the total area. Romania's forests contain 618 million metric tons of carbon in living forest biomass. The average volume is 217 cubic meters of wood per hectare of forest in Romania, while the European average is of 147 cubic meters. The annual growth of forestry is of approximately 5 cubic meters per hectare, 20 percent higher than the European average of 4 cubic meters per hectare. Forest prices in Romania are between EUR 2,000 and EUR 5,000 per hectare, while the cheapest type of wood - i.e. wood for fuel, is sold for approximately EUR 70 per cubic meter. Irina Popescu, irina.popescu@romania-insider.com (photo source: Photoxpress.com)