Dairy farmers are continuing to drive demand for land leases. The popularity of long-term leasing is also growing. The general sentiment from auctioneers is that the demand for land was still strong this year but that prices have remained steady.

An Irish Farmers Journal survey shows that grassland lets are more expensive in the dairy heartland of Munster where they range from €150/ac to €350/ac.

“Prices were firm this year even with the beef problems. Dairy is keeping a base in it, beef farms have to compete,” said Ernest Forde from Hodnett Forde in Clonakilty.

In Limerick, Tom Crosse from GVM, said that this year he leased a farm with a parlour for 10 years for €333/ac. He also leased out a farm, on a year-on-year basis to a beef farmer for €210/ac.

Tillage farmers are reportedly paying up to €300/ac in Munster.

Leinster

Prices are also strong in Leinster. Auctioneers across the east coast report that grassland leases are typically €200/ac to €300/ac for dairying or beef. However in the northern part of the region drystock farmers are paying slightly less at €150/ac to €210/ac.

“It’s been a really good season. Demand for land is there,” said Ann Carton from PN O’Gormon, New Ross. “A nice 50ac to 100ac parcel will go for €265/ac to €300/ac to a dairy farmer. The real interest is for naked land with 10-year leases and a five-year review.”

Similarly John Dawson in Tullow said that “there were some really good prices in the late three hundreds but the [price] curve has flattened off.”

Tillage farmers are paying anywhere from €150/ac to €280/ac for ground in Leinster.

“There is a 50:50 split in leasing with entitlements and without,” says Stephen Barry from Raymond Potterton, Navan.

“Dairy farmers will pay more if the land joins their milking block in which case it could go up to €400/ac in a competitive situation. Lay ground for spuds is around €600/ac or stubble ground for €450/ac.”

In the midlands Padraig Murtagh from James L Murtagh auctioneers said that land owners looking for a bit more stability in leases and are increasingly employing the services of an auctioneer to draw up the terms of the lease and to find someone to rent the ground.

“This year we took on an additional 2,000ac where people have retired or it’s a family farm that they don’t want to sell so they lease.

“There’s a value on employing an auctioneer rather than leasing to someone directly. When you use an agent you are detached from the transaction completely,” he said.

Meanwhile in the beef stronghold in the west and north of the country prices are slightly lower. Auctioneers are quoting prices anywhere from €130/ac to €250/ac.

“Anything that came on fresh, there was strong demand for because the long term leases have tied up land,” said John Earley in Roscommon, adding that €200/ac would be the norm.

Further west in Mayo and Galway, Gerry Coffey, notes that prices are closer to €130/ac to €180/ac. He says that he “was attending the pickets on the factory line and farmers told me they were going to lease out their land. But none of them came to me this season, there was a scarcity of land for leasing.”

SCSI/Teagasc report

A survey of 163 chartered surveyors from all over the country was conducted in December and early January 2020, pre-coronavirus. Agents were asked for their opinion on the introduction of tax relief for long-term leases of agricultural land to non-family members in Budget 2016, and particularly its impact on the volume of transactions for agricultural farmland with long-term leases during 2019. In Leinster and Munster, around two-thirds of agents said it had had a significant impact on the volume of long-term lease transactions (see table 2). Notably, only 16% of respondents in Connacht-Ulster reported a significant impact. One respondent in Connacht noted: “There is a big demand for leases, and the lease lengths are lengthening but that is due to the demand from tenants for more certainty, than because of the tax reliefs for the landlord. I don’t think it has much impact. But it’s maybe pushing leases above the five-year rule.”