Business Forum • 16 April, 2024 at 7:20 PM
CBRE Romania, the leader in providing commercial real estate services, launches an analysis regarding the business potential and alternative investment and development opportunities in Timiș County. According to the analysis, Timiș stands out as a vital centre of Romanian agriculture, ranking first in agricultural area with 693.034 hectares and second in organically cultivated land area. Additionally, the county in western Romania is attracting significant and growing interest from investors, representing 5% of the total agricultural land transactions nationwide in 2023.
"Timiș County, with its significant agricultural potential due to favourable climatic conditions and fertile soils, attracts investor interest due to the development opportunities in the area. In 2023, agricultural land transactions in Timiș County accounted for 5% of the national total. Furthermore, in the first two months of this year, approximately 850 transactions were concluded, marking a 31% increase compared to the same period last year," says Mădălin Aresmerițoaie, Senior Consultant Industrial & Logistic Services, CBRE Romania.
Timiș County stands out with diverse development opportunities, ranking first nationally in arable land area, with a figure of 530.808 hectares. This vast arable land area constitutes a solid foundation for the region's growth and diversification of agricultural activities.
Among the investment opportunities in the Timiș area, a plot of 1,500 hectares stands out, located approximately 10 km from Recaș and 35 km north of Timișoara. Positioned about 50 kilometres from the borders with Hungary and Serbia, the land is strategically located to facilitate access to international markets. With a brown alluvial clay soil known for its exceptional fertility and ability to support a variety of crops, it offers optimal conditions for plant growth. Additionally, the property's proximity to two farms opens up opportunities for collaboration and access to reliable agricultural resources and infrastructure.
Unlike other regions of the country facing drought periods with insufficient precipitation for profitable crops, Timiș County enjoys abundant rainfall. Furthermore, the drainage canal system significantly contributes to efficient water surplus management, ensuring optimal conditions for achieving high agricultural yields.
"Approximately 9.000 km of drainage canals serve nearly 380.000 hectares, used as buffers for irrigation water. Despite this, there is a high demand for water resources required for irrigation during drought seasons. Every year, farmers must adapt to continuously changing climatic conditions. However, hail has remained an extremely predominant weather phenomenon in recent years in the Timiș area, even in terms of damage. For example, in July 2023, torrential rains and abundant hail caused estimated losses of RON 15 million, affecting 25.000 hectares of land cultivated with rapeseed, wheat, and sunflower," says Horia Lupu, General Manager of Agra Insurance.
Timiș farmers align with new trends and adopt regenerative agriculture practices
Farmers in Timiș County are increasingly adopting sustainable agricultural production practices, abandoning chemical fertilisers and synthetic pesticide use. This transition promotes environmental protection and encourages the production of healthier and more natural agricultural products for consumers.
"In Timiș County, almost 60,000 hectares are cultivated using organic methods, ranking second among the counties practising this type of agriculture. Organic agriculture refers to practices that do not use chemicals but specific cultivation technologies, the only type of agriculture regulated by standard requirements. Farmers resort to this due to increasing demand for certified organic products. Moreover, the support the Ministry of Agriculture provides for those practising this agriculture is significantly higher than that for traditional agriculture," says Ion Toncea, President of the Association for Sustainable Agriculture in Romania.
Conservative agriculture improves the reserve of organic carbon, biological activity, above-ground and underground biodiversity, and soil structure. It also significantly reduces soil degradation, resulting in increased productivity.
"In the long term, more and more farmers will switch to conservative agriculture because they will reduce farm expenses, machinery costs, or personnel. Operations are reduced almost to a minimum. Moreover, we can have a crop that requires less water, as in the case of these agricultural practices, evaporation is reduced by the vegetable residues forming the surface layer. The soils in Timiș are known for their high fertility, and conservative agriculture fits well with these nutrient-rich soils because it maintains and improves their fertility in the long term without excessively relying on external inputs, such as chemical fertilisers," adds Petre Dănilă.
Despite the area's agricultural potential, farmers need help with market access. Internationally, exports resulted in a capital loss for Romanian farmers and decreased prices for raw materials, leading to farmers' inability to cover their expenses and dependence on financial institutions. Another underdeveloped sector in the Timiș area is livestock farming. Due to cereal and legume production, there is a high potential for animal and poultry farming, mainly sheep, cattle, and pigs.
However, not only agriculture attracts investors' attention. Logistic developments in Timiș County make it the leading regional industrial hub after Bucharest. This strategic positioning at the country's western border and with developed infrastructure, including the A1 highway, attracts logistics, automotive, and manufacturing investors. With a modern stock of over 780.600 square meters of industrial and logistics spaces and a vacancy rate of only 8.2% at the end of 2023, Timiș County is a magnet for major industry players.
Through collaboration with industry experts and specialists, CBRE aims to gain a comprehensive understanding of the dynamics and challenges facing investors in this region, which is of great agricultural and economic importance to Romania. The analysis revealed the opportunity was represented by investments in agricultural land.