Farmers are relieved that tilled land will no longer be sold off to the highest bidder as so-called ‘recreational land’ but they are waiting with bated breath for the government to propose an equation for a ‘fair’ price.
Farmers make an average profit of just €200 on each tumolo of tilled land that produces three crops in one year, according to an exercise by Times of Malta and farmers.
This would vary depending on whether the crop is rainfed or not, and also whether the land is used as a vineyard or to grow other fruit trees.
According to the exercise, the average income from three crops totals €7,500, while expenses reach €7,300. Expenses include seeds and seedlings (€1,200), fertiliser (€540) and manure (€350).
There is also the cost of depreciation and maintenance of the irrigation system and machinery, tax at three per cent of income, plastic mulch, electricity, drip irrigation, plant protection products, fuel and lubricants, interest on the value of machinery, tools and stock, and interest on capital required to sustain expenses.
The biggest cost remains salaries, worked out at 650 hours at €6 per hour, totalling an average of €3,900.
Malcolm Borg, who heads the Għaqda Bdiewa Attivi told Times of Malta that farmers who survived a pandemic and inflation caused by the invasion of Ukraine have also seen an increase in the price of fertilisers, mulch, plant protection products and drip irrigation, further eroding profits by 30 per cent.
Several farmers are trying to make up for this by carrying out more work themselves rather than employing assistants so that they can cut down on salary expenses.
Most concerned about quantification of fair price
Reacting to proposals on agricultural land reform, published by the government this week, Borg said farmers who leased land from private individuals were satisfied by the proposal of tying the classification of a farmer to agricultural use of the land.
Meanwhile, other farmers who wanted to expand their operations were pleased that land will be leased to genuine farmers and that there will be an authority buying land from owners and selling it to genuine farmers.
But all are mostly concerned about the quantification of a ‘fair’ rent.
Ever since a court in 2020 declared that the rural leases law is unconstitutional, dozens of farmers have ended up in court, with private landowners challenging the so-called qbiela law.
In 2021, an exercise by Times of Malta found that one tumolo of land (1,100m2) was being advertised for at least €40,000. Advertised prices spiked to €266,000 for two tumoli of arable land in Rabat and €1.5 million for three tumoli with one large room in Siġġiewi.
Ever since a court in 2020 declared rural leases law is unconstitutional, dozens of farmers have ended up in court
A repeat of the exercise this week found a similar three tumoli of land in Mtaħleb, being sold for €1.5 million. In Dingli, a plot of ODZ land “ideal for recreational purposes” measuring half a tumolo with one room is being sold for over €100,000.
Farmers looking into acquiring arable land are being asked for between €80,000 and €100,000 per tumolo, and this is unaffordable for most, as an average of 12 tumoli are needed to start a full-time agribusiness.
Last year, the cabinet approved changes to agricultural lease laws in a bid to ease the transfer of land between family members, but this only applies to public land.
On Tuesday, the government launched a White Paper proposing the establishment of a fair rent price after taking into account the land’s value.
According to the proposals, rent reviewed by the board should not exceed 1.5 per cent of the land’s free value in the open market per year, while lease agreements shall be for a minimum of eight and a maximum of 16 years.
Separately, Labour MEP Alex Agius Saliba petitioned the European Parliament to address the violation of farmers’ fundamental rights in Malta and green-light European funds for Maltese farmers threatened with eviction.
According to Eurostat data, renting one hectare (nine tumoli) of arable land in 2020 was most expensive in Italy with an average €837 per year, while the cheapest was in Slovakia (€57 for nine tumoli). Still, the cheapest regions in the EU were Mellersta Norrland and Övre Norrland in Sweden (€34 for nine tumoli).
Top positive takeaways and top concerns for farmers:
+ Control over use of agricultural land
+ Matching demand for land by genuine farmers with supply of land.
+ Stating that a just price must be established with parameters that are based on agricultural production.
– Will the just price depend on the farmer?
– How will the definition of genuine farmer be drawn up?
– How will the use of agricultural land will be tied to genuine farmers. What mechanism is going to be used? Will nongenuine farmers be prevented from buying land?