Romanian farmland set for high growth

A hectare of agricultural land could sell for up to 8,000 euros within the next five years, which is close to the European average. At present, agricultural land sells for 2000-5500 euros per hectare.

Experts say more and more foreign investors, especially from Italy and Germany, are coming to Romania to develop agricultural businesses. Foreign companies find the conditions in Romania attractive, taking into cosideration the fact that Romania is number two in Europe, after France, in terms of agricultural land mass. Also the favourable microclimate places it in the top three in terms of agricultural potential.

Romania has 9.7 million hectares of agricultural land, of which only one third has been exploited to its fullest extent. Peasants have no money to work their land, therefore an important part of the agricultural land has now turned into fallow. Only three million hectares of the total area of agricultural land are properly worked. However, within the next years this situation will change.

The curent economic situation led to global price increases for agricultural products, which is why many foreign companies have chosen Romania as their destination to develop agricultural businesses. The lack of large plots of farming land in most European countries is forcing investors to buy land in Romania, where they can expand their production.

Danish company FirstFarms has already bought 3,000 hectares of land in Romania and began farming and raising livestock domestically. "We chose Romania for our investments because it is a new European Union member and offers a great deal of opportunities to extensively develop agricultural production.

Romania imports a large amount of agricultural products, which is why we want to direct our production to the Romanian market, where we soon expect an improvement in purchasing power," stated Frank Lorentsen, FirstFarms' country manager in Romania for Ziarul Financiar.

However, the company officials revealed they would not stop here. "We have invested in two different regions so far, and we are still looking for locations where the infrastructure is good," said Lorentsen.

Although the average price at which the company bought farming land was 2,700 euros per hectare,(in 2007) the representatives of FirstFarms believe prices can be influenced over the next few years by "demand, location, and the quality of land".

Moreover, the price of land in Romania differs greatly from the price of large amounts of land in most European countries.