These motives, along with the need to feed an increasing global population and the realisation that, managed appropriately, farmland helps mitigate against climate change and biodiversity loss, have led to a continued interest in farmland from governments, investment funds and private investors around the world.

Savills latest research publication, Spotlight on Global Farmland, reports a continued rise in farmland capital values globally with Savills Global Farmland Index (which tracks capital value performance for prime farmland across the world) recording a 10% average annualised growth rate since 2002.

2023 was a strong year

2023 proved a strong year for global farmland markets. According to our index, the average value of global farmland increased by 8.5%. It is important to note these figures are based on average land values – values within countries and regions vary, and depend on many factors such as the climate, location, transport logistics, water resource, soil type and government policy. 

Central Europe sees highest growth rates

Closer regional analysis shows Central Europe reported the highest growth rates during 2023 with Poland and Romania both recording an increase in average values of 13%. Compared to Western Europe, the Americas and Australasia, this region also had the greatest rise in average values since 2002. Much of this growth occurred during the early 2000s with a 33% average annualised growth rate in the five years prior to the global financial crisis in 2008. During the five years to 2012, the index reported an average increase of 18% followed by 4% in the subsequent five-year period to 2017. 

Since 2017 values in Central Europe have risen by 6% and the steeper rate of growth reported in 2023 may reflect the fact that initial investor fears around geopolitical risk in Central and Eastern Europe have largely subsided. In Western Europe average farmland values rose by 7% during 2023.

Values in Argentina

North and South America both achieved a 9% increase in average values during 2023. According to the Argentine Chamber of Rural Real Estate, land values in Argentina had declined since 2013 providing an opportunity for investment in agriculture. Land values began to stabilise during 2022 and have continued to react positively to the election of Javier Milei in 2023.

Australasian markets

In New Zealand, the Real Estate Institute of New Zealand reported a quieter market in 2023 due to a smaller number of buyers and properties for sale. Average values in both Australia and New Zealand were further impacted by rising commodity prices and interest rates. 

In conclusion, with global food demand expected to increase by over 60% during this century, and productive land availability per capita set to decrease over that same period by a third, it is no surprise why farmland value rises have consistently beaten inflation over the years. There is every reason for this trend to continue in the long term.

Further information

Contact Jonny Griffiths or Nicola Buckingham