The Ukrainian agricultural land market has increased by 30% this year

The volume of the Ukrainian agricultural land resources market has increased by almost 30% compared to the corresponding figure from last year. This is stated in the analytical review by USAID AGRO. At the same time, the weighted average price for the purchase and sale of land in July, which is considered the control period, was 46,000 UAH per hectare. This figure is 4.5% higher than the corresponding figure for June and 1.5% higher than the figures for May of this year.

Since the opening of the market for legal entities on January 1 of the current year, land prices have increased by 24% for all types of land and by 19% for so-called "commodity" lands.

Overall, since the opening of the land market for legal entities, nearly 1,000 companies have exercised their right to purchase land, with 363 companies acquiring at least one agricultural plot. Legal entities are gradually increasing their presence in the agricultural land market in Ukraine. Since the beginning of 2024, legal entities have purchased 8,849 plots of land with a total area of 26.2 thousand hectares. Considering that there are 23,500 agricultural producers engaged in the production of grains and pulses and 18,500 agricultural producers engaged in sunflower production in Ukraine, the share of legal entities in the land market still has potential for growth.

It is worth noting that recently the State Property Fund of Ukraine completed the corporatization process of the state enterprise "Agricultural Investment Fund," creating the State Land Bank LLC based on it. The newly established company, which is 100% state-owned, is the first state operator of agricultural land in Ukraine. This is a necessary final step in the implementation of the "Land Bank" project before the official launch of the first online auctions for the lease of state lands.

If we talk about the problems in this market, it should be mentioned that over 20% of agricultural lands in Ukraine are still not registered in the cadastre. Currently, the Ukrainian government expects that the inventory of all agricultural lands in the country will lead to additional annual revenues for local budgets of nearly UAH 28 billion. According to Prime Minister Denys Shmyhal, it is currently necessary to strengthen cooperation on increasing the tax base of local budgets. He also noted that to expedite the land inventory process, the central government and regions have signed a relevant memorandum.

It should be noted that the prices for buying and selling agricultural lands in July 2024 resumed growth after a slight decline in May-June and were the highest since the market's inception. The weighted average price for buying and selling in July 2024 was UAH 46,000 per hectare, which is 4.5% higher than the corresponding figure in June and 1.5% higher than the figures from May of this year.