Farmers are calling on the government to enforce a capping on prices of agricultural land, as budding growers are finding it impossible to acquire their own fields to till.
With one tumolo of land going for at least €40,000, and an average of 12 tumoli needed to start a full-time agribusiness, young farmers are expected to fork out half a million euros in land, over and above their investment in cultivation machinery and tools.
This very conservative estimate is already three times the price of arable land five years ago. According to a 2016 EU research paper on agricultural land prices, one tumolo of land cost slightly more than €14,000. Back then, this was already expensive, with European prices ranging from €178 per tumolo in Sweden to €8,000 in the Netherlands and €10,500 in the Canary Islands.
Malcolm Borg, who chairs Għaqda Bdiewa Attivi, told Times of Malta that farmers looking into acquiring arable land in Malta are being asked for some €70,000 to €80,000 per tumolo, while adverts seen by this newspaper show prices spike to €266,000 for two tumoli of arable land in Rabat.
One agent advertised one tumolo of agricultural land with approved permits for stables in Siġġiewi for €270,000, while another one is selling three tumoli with one large room in the same locality for €1.5 million.
“The situation is bordering the absurd: high demand for agricultural land for non-commercial purposes is making this a true real estate opportunity,” Borg said.
A large stretch of land was sometimes being divided into one tumolo parcels and sold off at “ridiculous prices”. Land with rooms fetched a higher price, further confirming the failure of the Planning Authority’s Rural Design Guidelines that are meant to only allow permits for rooms to store tools and machinery.
The situation is bordering the absurd
“Rooms are now being used by sellers to promote recreational activity and providing sellers with the opportunity to considerably inflate the price.”
Agricultural land, he said, was being “killed off”. Trusting agricultural land in the hands of people who have no interest in growing food commercially could ultimately leave a negative impact on Malta’s food security and sovereignty.
The inflated prices put new Maltese farmers at a significant disadvantage when compared to fellow European farmers who can purchase large stretches of land for a few thousand euros. This is also the case for farmers who want to expand their operation to have more favourable economies of scale, Borg said.
The other option is to have government land transferred on them, however, they would need to know of an existing farmer who wants to transfer their land, something that is not easy to come by.
Farmers are therefore calling for the state’s intervention.
'Government should enforce price capping'
“Political intervention in this matter is not only needed to tighten the ‘tool room’ provision and prohibit excessive fragmentation of land but to also control prices,” Borg said.
State intervention to prevent excessive farmland prices could be justified under EU law, he added.
In its interpretation of the Acquisition of Farmland and European Union Law, the European Commission notes that “the prevention of unreasonable (excessively speculative) prices, be they far too high or too low, appears to be a legitimate justification in light of the agricultural policy purposes recognised by the Court of Justice of the European Union.
“Price regulations which are based on objective, non-discriminatory, precise and well-tailored criteria can be suitable to curb excessive land speculation or to save professional farmers from purchase costs which could endanger the profitability of their farms,” it adds.
Borg warned that if the state was afraid to prevent excessive prices because of political backlash, “then we will continue condemning our agricultural land to speculative forces, to the detriment of individuals whose ambition is the growing of food for the local population”.