Price of farmland in region ‘is set to rise even further’
THE price of farmland in Suffolk and East Anglia as a whole is set to rise even further as the boom in the sector continues, a land agent has predicted.
Giles Allen, a partner at Strutt& Parker’s estates and farm agency department in Ipswich, said agricultural land was looking a good prospect for buyers looking for a “safe” investment.
He said Strutt & Parker was advising “a growing number” of investors interested in purchasing farmland in Suffolk and the region as a whole.
Mr Allen says there are “compelling reasons” for his prediction.
Among these is that despite forecasts that the 2011/12 global grain harvest will be the largest ever, global consumption is forecast to exceed production by 14 million tonnes, which means the world will need to keep producing record harvests to keep up with demand.
Mr Allen points out that after the 2012 harvest, it is predicted that the world stocks of “coarse grains” which include wheat, will be 342 million tonnes, down 13% from 2010, representing just two months’ supply.
Maize stocks in the USA, the world’s largest exporter, are at their lowest level for 30 years, he adds.
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With global grain consumption on the rise - up by more than a fifth since 2003 - growing land is in demand.
Pressures such as a growing global population which needs to be fed, the effect of climate change on problems such as crop disease, a growing demand for fuel which was diverting land from food production and pressures on water supplies are all having an impact, he points out.
“We are advising a growing number of investors interested in purchasing farmland in Suffolk and throughout East Anglia,” said Mr Allen.
“The issues of food production and food security around the world have become of paramount importance to governments.
“In the UK, we have exceptional farmers, established markets and a well regulated and understood legal system controlling the purchase and ownership of UK property.”
Mr Allen believes that even if other potential farmland areas are fully exploited, there will still be a demand for farmland.
“Despite the rapid rise in land values in Suffolk and throughout East Anglia in the last four years, prices will rise further,” he said.
“Even if Eastern Europe and South America maximise the potential of their farmland, and even if Europe embraces genetically modified crops, we will only be part of the way to producing the food the world population will require between now and 2050.”