Agricultural land and rents price rate will be about 5%, announces the Bulgarian Association of Agricultural Land Owners

During a seminar held in Borovets on April 13th-14th 2019, the Chairperson of the Board of Managers, Stayko Staykov, announced that the agricultural land market was stable and predictable during the past year with a stable minimum growth of agricultural price rates of 5%. He believes that this tendency will continue into the current year with the secondary market increasing its influence. Mr Staykov specified that there is an ongoing purchasing interest towards quality agricultural land which price is defined not only by its climate and terrain specifications but also by the size of the plot, its soil qualities, irrigation availability and contract conditions for renting the land.

In 2018, Dobrich once again comes first with the highest average agricultural land price of 2000 BGN/0,1ha, the minimum being 1550 BG/0,1ha, with calculations based on actual business transactions. In comparison, in 2017, business transactions in the region were concluded at the maximum average price of 1800 BGN/0,1ha and a minimum average price of 1600 BGN/0,1ha. Silistra region comes second in terms of the highest price paid per ha agricultural land and this tendency was observed during the past year as well. The highest price paid there was 1600 BGN/0,1ha and the lowest 1350 BGN/0,1ha, respectively. The third position in terms of price is taken by Varna, Ruse, Pleven, Shumen and Razgrad areas, wherein buyers of agricultural land paid a maximum price of 1300 BGN/0,1ha. According to BAALO statistics, the lowest prices, in contrast, were noted in Gabrovo and Kurdjali- 400 BGN/0,1ha.

Bulgaria is characterized by an extremely fragmented agricultural land, the most fragmented in Europe actually, after the final re-establishment of its current borders, says Mr Staykov. He believes that the main problems of the agricultural land market are related to the lack of Consolidation law, a poor irrigation infrastructure and the lack of protection system against hail.

BAALO believes that a crucial point in the country’s current agricultural development will be the adoption of a law treating land property rights, agricultural land plot relations and agricultural land preservation. Ms Ventsislava Moneva, association member, claims that the last legislation draft offered contradicted not only Bulgarian Constitution but also a number of other legal aspects. Its supposed implementation would trigger a conflict between landowners and land tenants. She supported her opinion by giving the example of a land tenant being able to sublease to a third party without actually legally possessing ownership of the land. Thus a land tenant, given the rights of land property possession based on an yearly contract agreement, can sublease to a third party, including the possibility of a 10-year rent contract, without the knowledge of the actual owner. BAALO expects that the Ministry of Agriculture reinitiates the dialogue between organisations in the industry and expects them to be included in working groups involved in the drafting of the Agricultural Law.

According to Ms Galina Peycheva-Miteva, BAALO Vice-Chairman, numerous ambiguities are still evident in the Common Agricultural Policy and the insecurity is a major point for concern for the farmers. She also stated that the payment ceiling should be defined according to national specifications as work pay level varies in different EU member states. The problem is that everybody works within the framework of a Single Market but under different conditions.

BAALO suggests that all associations involved in the agricultural industry should unite into a single national association which would function as a representative in the institutions. Practical experience shows that there are commonly shared positions on key issues regarding agricultural policy, believes the Board Chairperson Stayko Staykov. He also stated that discussions with similar organisations to discuss the above mentioned issue will soon be executed.

BAALO proposes the creation of a National Land Bank which will assume an active role in the processes of establishing and maintaining of consolidated agricultural land. This will provide an effective management of agricultural land and potential investment in the agricultural sectors. The bank will be an active participant in the implementation of government policies for sustainable development of land relations and will also be responsible for activating land property market.