Scale and Conditions of Agricultural Land Lease in the Case of Individual Farms

Abstract

Abstract The aim of the study is to determine the scale and conditions of agricultural land leases in the case of individual farms and their impact on the area structure of farms, opportunities for the development of lease transactions, mainly between neighbors, as well as difficulties in this segment of the agricultural land market. The analysis was based on data from Statistics Poland (Polish: GUS) and the National Support Centre for Agriculture (Polish: KOWR), as well as the results of multi-year field research representative of individual farms conducted by the Institute of Agricultural and Food Economics National Research Institute mainly in 2011 and 2020. The analysis showed the development of the lease market, mainly neighbor-to-neighbor leases, and the increasing impact of leases on increased land equipment for individual farms. Between 2011 and 2020, the share of individual farms organized with leased land increased from 16 to 28%, and the share of leased land in the total area of land at the disposal of individual farmers grew from 15 to 20%. The number of persons who leased a larger area of land also increased. The changes were mainly a consequence of an increase (by approx. 40%) in land leased from neighbors. With depleting resources of undistributed treasury land and farmers’ attachment to patrimony, neighbor-to-neighbor leases will be the basic way to provide more land to commercial farms, and thus increase their competitiveness. For this to happen, it is necessary to overcome the main barriers hindering the growth of agricultural land mobility through the institutional regulation of the private lease market and taking actions to persuade owners of agricultural real estates who earn their living from non-agricultural sources to lease land that they do not use.