Non-agricultural investors on farmland markets
A new study investigates structure and intentions of so-called investors
Since 2007 purchase and lease prices of farmland in Germany have markedly risen. In public discussions, these price spikes are often associated with non-agricultural and supra-regionally active investors. And their investments are mostly criticized by commentators. The German Ministry for Nutrition, Agriculture and Consumer Protection (BMELV) has commissioned the Institutes of Rural Studies and Farm Economics of the Thünen Institute (vTI) to provide a status quo-analysis of such investors on the farmland market in Germany, and to investigate the effects of these investments.
Since statistical data referring farmland markets does not contain any information on non-agricultural investors, the study is mainly based on four regional case studies and interviews of experts from supra-regional active institutions. Focal point of the investigation is East Germany where the mobility of farmland and the dynamics of prices are especially high. Given the heterogeneity of the group of ‘investors’, even the demarcation of the group is difficult. Locally, even investors who have bought a farm in the 1990s and since then have cultivated the land themselves (or through a manager) are counted among this group. Beside this type of investor, which is frequently found in East Germany, there are many non-farmers who buy relatively small amounts of farmland as a safe investment and lease the land. Small in numbers however are investors buying whole farms in several regions and organize them from a headquarter. These supra-regionally active investors feature a strong orientation towards energy production. Hardly any information could be gathered on the purchase of shares in farm holdings like stock companies and other legal persons which indirectly leads to land property.
Regarding the effects of the investigated investors on production, employment, farm sizes, and economic development in the regions, the assessments are fairly different due to the respective interests of the interviewees. Therefore it is essential to deal with the topic in a differentiated way so as to avoid all too simples answers.
the study (in German, PDF, 3.2 MB)
