Germany: Investors buy up farmland- Intervene with the law
Indo & NY | 1 January 2023

Germany: Investors buy up farmland- Intervene with the law

Brandenburg's Agriculture Minister Axel Vogel (Greens) wants to use a new law in 2023 to prevent investors from outside the industry from buying up a large part of the agricultural land.

"The areas are sold to the farms under their butts," said Vogel of the German Press Agency in Potsdam. "Land has become an object of speculation."

The areas are often bought as an investment, so that what counts most is the price increase. The normal farmer cannot keep up with the increased prices.

"Young farmers no longer have a chance to buy land." Vogel wants to introduce the draft agricultural structure law to the state parliament in the second quarter of 2023. It should have a price-dampening effect. The project is part of the coalition agreement concluded in 2019 and has been discussed for some time. Quarrels with the state farmers' association also arose.

The project took some time because it was new legal territory in many areas, said Vogel. "Many agricultural ministers of the federal states have burned their fingers on it".

Vogel named land prices, which have quadrupled since 2007, as a problem. Large investors could sometimes put down 40,000 euros for an area for which a farmer would pay a maximum of 12,000 euros.

According to the minister's plans, the rule is to be introduced in the future that the agricultural market value will generally apply to the examination of land sales. This means that only the prices paid by farmers in a region when buying land are taken as a basis. The farmer should be able to exercise the right of first refusal at this price.

"This would really have an incredible price-dampening effect," said Vogel.

He also wants to introduce a price brake for lease prices. Brandenburg has around 1.3 million hectares of agricultural land. Two thirds of these are leased, i.e. not owned by the farms.

The lease price for arable land was 184 euros per hectare in 2020. For comparison: in 2001 it was 73 euros, in 2010 the price was 105 euros per hectare.

The state farmers' association demanded that the ministry finally deliver, the time for announcements was over. So far, only key points are available, but without the "full submission of the law" the farmers' association cannot contribute to the participation process with a statement.

"If, despite 70 new jobs in the MLUK (Red.: Ministry of Agriculture, Environment and Climate Protection) there are not enough staff to create them quickly, then external offices have to get involved, as was the case recently with the ecological action plan," said the President of the State Farmers' Association, Henrik Wendorff, said. "We hope that we can finally get to work in 2023. Nothing would be worse than pushing a half-baked law through the state parliament due to lack of time, which destroys the land market in Brandenburg more than it saves it".

Farmer President Wendorff primarily criticizes a high loss of agricultural land, for example through road and housing construction as well as industrial projects. "Every day, more than seven hectares, that is more than seven football pitches, are lost to agricultural use in Brandenburg."
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Source: Indo & NY