52
D. Kirschke et al.
70
80
90
100
110
120
130
year
Agricultural output
Crop producon
Animal producon
Fig. 3.9 Agricultural producer price index in Germany, 2000–2018 (2010 = 100) (Source Own
compilation according to Statistisches Bundesamt (various years), Fachserie 17, Reihe 1.)
Fig. 3.9. Hence, international agricultural prices have become a major determinant
for land prices in Germany and will be so in the future contributing to stable and,
possibly, increasing land prices.
The demand for agricultural land certainly reflects the development and the
competitiveness of the agricultural sector, but increasing land prices also reflect
the demand from non-agricultural sectors. We have argued that the demand for land
for human settlement and transport infrastructure remains to be strong, and this is
certainly a “pull factor” for land prices. Some interesting new “pull factors” have
become the demand for land for nature conservation and natural resource protection
and bioenergy production, but since these demands are clearly policy-driven, they
are discussed in the following chapter.
There may be some additional factors contributing to rising land prices, but relationships are less obvious. Farm succession has, generally, been considered a problem
in times of decreasing agricultural prices, but times seem to change, at least in some
regions. There is some indication that the taking over of farms by young farmers is
connected with farm growth and increasing land demand, e.g. in Bavaria (Statistische
Ämter des Bundes und der Länder 2011). Additionally, investment into agricultural
land becomes attractive for investors outside the agricultural sector. Such a development has been observed for East German agriculture, even though this development
cannot yet be considered as a major new trend (Tietz 2015). Low interest rates
caused by the European Central Bank’s monetary policy might actually support this
development.
It is a well-known debate in agricultural economics that technological progress
and increased productivity contribute to a higher demand for land and, thus, rising
land prices. These “pull factors” for land markets continue to be relevant since new
D. Kirschke et al.
70
80
90
100
110
120
130
year
Agricultural output
Crop producon
Animal producon
Fig. 3.9 Agricultural producer price index in Germany, 2000–2018 (2010 = 100) (Source Own
compilation according to Statistisches Bundesamt (various years), Fachserie 17, Reihe 1.)
Fig. 3.9. Hence, international agricultural prices have become a major determinant
for land prices in Germany and will be so in the future contributing to stable and,
possibly, increasing land prices.
The demand for agricultural land certainly reflects the development and the
competitiveness of the agricultural sector, but increasing land prices also reflect
the demand from non-agricultural sectors. We have argued that the demand for land
for human settlement and transport infrastructure remains to be strong, and this is
certainly a “pull factor” for land prices. Some interesting new “pull factors” have
become the demand for land for nature conservation and natural resource protection
and bioenergy production, but since these demands are clearly policy-driven, they
are discussed in the following chapter.
There may be some additional factors contributing to rising land prices, but relationships are less obvious. Farm succession has, generally, been considered a problem
in times of decreasing agricultural prices, but times seem to change, at least in some
regions. There is some indication that the taking over of farms by young farmers is
connected with farm growth and increasing land demand, e.g. in Bavaria (Statistische
Ämter des Bundes und der Länder 2011). Additionally, investment into agricultural
land becomes attractive for investors outside the agricultural sector. Such a development has been observed for East German agriculture, even though this development
cannot yet be considered as a major new trend (Tietz 2015). Low interest rates
caused by the European Central Bank’s monetary policy might actually support this
development.
It is a well-known debate in agricultural economics that technological progress
and increased productivity contribute to a higher demand for land and, thus, rising
land prices. These “pull factors” for land markets continue to be relevant since new