Average cost of leasing farmland in state ownership transferred to leasing at auctions as of January 1, 2018 totaled UAH 2,793 per ha, which is 24.2% more than a year ago. According to a posting on the website of the State Service for Geodesy, Cartography and Cadastre, the cost of leasing last year UAH 2,249.80 per ha.
“The possibility of land transfer without holding auctions was blocked, and land auctions turned into a highly competitive tool that ensured the average rental rate of state-owned land for the past year at the level of 14.74%,” First Deputy Minister of Agrarian Policy and Food of Ukraine Maksym Martyniuk said.
He also recalled that in 2017, the state for the first time determined the basic principles of land management by adopting the appropriate strategy and fixing the least permissible leasing parameters (up to seven years and no less than 8% of the standard pecuniary value).
At the same time, the authority pointed out a twofold difference in the cost of leasing of state-owned and private property. So, the average cost of leasing farmland in private property last year was at the level of UAH 1,400 per ha, which is 25% higher than the indicator of 2016 (UAH 1,090 per ha). The highest rents for land parcels were recorded in Cherkasy (UAH 2,960 per ha), Poltava (UAH 2,500 per ha), Kharkiv (UAH 2,100 per ha) and Sumy (UAH 2,100 per ha) regions. At the same time in Zakaarpattia region the rent amounted to UAH 718.90 per ha, Zaporizhia – UAH 794.70 per ha, Mykolaiv – UAH 825.80 per ha and Kherson – UAH 842.30 per ha.
The total area of this type of farmland leased out under contracts amounted to 16.9 million hectares.
According to Martyniuk, the growth in the cost of leasing private land is hampered by the presence of local monopolies of tenants, the lack of a free land market and effective associations of land owners, most of which are citizens of old age.
