This is the largest increase in land prices recorded since the barometer began recording prices in 2013. The weighted average price per acre of farmland at the end of 2022 stood at approximately €10,843 per acre, up from €9,279 at the beginning of the year.
Price growth was seen all throughout the country in 2022, with the midlands being the standout region, experiencing a 21.9 per cent increase in agricultural land prices per acre. The southwest (+16.6 per cent), mid-west (+12.9 per cent) and mid-east (+11.1 per cent) also experience significant price increases, with the growth in each region respectively being more than double that seen in 2021.
This was followed by the west (+8.5 per cent) and southeast (+5.4 per cent). The border region saw only 2.7 per cent growth throughout 2022, this is compared with 13.2 per cent for the previous year. The most expensive region for agricultural land at the end of 2022 was the mid-east, with a price per acre of €12.667, up from a price of €11,400 in 2021.
Prime grassland values grew by 10.6 per cent in 2022, an increase from the 7.6 per cent growth seen in 2021. The weighted average price of an acre of prime grassland now stands at €12,170, up from €11,000 in 2021. The most significant price growth in 2022 was seen in the south-west region, with an increase of 17 per cent. And, the most expensive region for prime grassland was the southeast, with a price of €13,645 per acre.
Strong growth was also seen in the remainder of the regions, such as the midlands (+13.8 per cent), mid-west (+10.7 per cent) and west (+10.3 per cent) regions. The border region experienced a 4 per cent increase in prime grassland prices, a substantial decrease from the 17 per cent growth seen over 2021.
Prices rose 2.4 per cent nationally in quarter four, an increase from the 1.7 per cent growth seen over the same period in 2021. The midlands experienced the largest growth in grassland prices, at 4.8 per cent. The mid-east (+3.8 per cent), southeast (+3.5 per cent) and mid-west (+2.8 per cent) saw grassland prices rise also.
The west and border regions saw no change in prices, and the south-west region saw a price fall of -0.7 per cent. Marginal grassland also experienced significant growth throughout both the quarter and annually, rising 3.5 per cent and 11.1 per cent, respectively. The weighted average price of marginal grassland in 2022 was €7,430 per acre
Prime arable land values grew by 12.4 per cent in 2022, more than double the 4.8 per cent increase seen during 2021. The weighted average price per acre for prime arable land for 2022 stood at €13,014, compared with €11,577 in 2021. The midlands saw the largest price increase in 2022 with a growth rate of 26 per cent. The mid-west (+17 per cent), south-west (+15 per cent), mid-east (+11 per cent) and west (+10 per cent) each saw significant increases also. The southeast(+5 per cent) and border (+3 per cent) saw smaller levels of price growth. The most expensive region for prime arable land per acre was the mid-east, with a price of €14,565 per acre. The least expensive region was the west, with a price of €8,800 per acre.
Looking to 2023, there are several factors which will impact the Irish agricultural land market. Rising prices may see the supply of land coming to the market increase as landowners look to achieve capital gains. There has been a rising popularity of vendors letting lands to larger farmers who possess the scale to achieve higher marginal returns. The wider economic climate is expected to remain turbulent over the coming year, with price inflation, particularly in oil, putting further pressure on farmer margins. Unpredictable weather because of climate change may also hamper the performance of the tillage market. Despite this, we can expect another strong year for the agricultural land market in 2023. The demand for commodities will remain high as the global economy continues to unwind itself from supply chain constraints.