Farmers will be able to buy land situated near their residence at market prices, paying only 10% of its value. Instalments will be payable over 20 years. The project assumes that 30% of land presently used by tenants will be taken away from them and sold to farmers.
Edward Sadłowski, president of Zachodniopomorska Izba Rolnicza (West Pomeranian Agricultural Chamber), believes that the project is beneficial to farmers yet there are still some question marks.

“Financial possibilities of farmers are limited, especially after the poor harvest we had this year. The proposal to sell land in limited tenders is a good idea. What might pose a problem is the additional terms of securing the transaction. The Agricultural Property Agency (ANR) requires that a transaction be secured by a mortgage on the purchased land plus additional security on the farmer’s assets. If farmers do not buy the land offered by ANR, it will be sold in open tenders and it will be available to basically anyone,” says the president. Proposed solutions may be beneficial especially in the regions where land resources to be given to individual farmers have been long exhausted, e.g. in the Pyrzycki and Stargardzki regions. Edward Sadłowski admits that the amount of land available to farmers will increase. The problem, however, is that not all farmers will be able to afford it.

In the opinion of dr Bogusław Gołębiowski of the Faculty of Economics of the West Pomeranian University of Technology, the new regulations concerning the sale of land are an ad hoc action aimed at improvement of the condition of the state budget. “Farmers should be able to rent land, just as farmers do all over the world. Polish farmers are not too wealthy. They don’t have a lot of money, especially in the face of low prices of grain and expensive loans. When rent is high, I don’t believe that farmers will be willing to buy land. Such purchase will pay over 20-25 years,” adds dr Gołębiowski.

Adam Poniewski, director of the Regional Branch of the Agricultural Property Agency in Szczecin points that currently, farmers buying agricultural land from the Resources of the Treasury Agricultural Property Stock pay min. 20% of the price of sale. The rest may be paid over max. 15 years in six- or twelve-month instalments. “Interest rate on the price of sale paid in instalments is one fourth of the rediscount rate, however, not less than four percent per annum,” explains Mr Poniewski.

These are the terms of payment that will apply till the end of 2009. The Ministry of Agriculture and Rural Development has developed a draft of a new ordinance which specifies that the interest rate will be the same if specific conditions have been met. Only failure to meet the conditions will increase the interest rate to half of the rediscount rate, not less than eight percent per annum. The interest rate applies in the case of timely repayments.

This year, the Szczecin branch of ANR carried out over 2.5 thousand tenders for sale and rent of land. “Over 12 thousand hectares of land were put on sale an only 3 thousand were bought. This means that the effectiveness rate is 20%,” says the head of the Szczecin branch of ANR. This shows that so far, land available for sale of rent attracts moderate interest. Farmers are discouraged mainly by high prices of land and costs of loans. Currently, the price of one hectare of land in West Pomerania is approx. PLN 13 thousand. The price goes up by 15-20% each year.

At the end of last year, the resources of the Regional Branch of the Agricultural Property Agency in Szczecin had nearly 431 thousand hectares of land, 344 thousand of which was rented. There is still 57 thousand hectares of idle land to be disposed of.

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