Australian farmland prices are expected to grow modestly in 2026, continuing the trend seen over the past year, Rabobank says in its latest annual Australian Farmland Price Outlook.
The report, by the specialist agribusiness bank's RaboResearch division, says the outlook for agricultural land prices in 2026 points to "moderated" growth, with the median price per hectare set to increase by approximately two per cent in its "base case" forecast.
This expectation is driven by the combination of a mixed outlook for agricultural commodity prices, elevated farm input costs exacerbated by the Iran war and the prospect of further interest rate increases.
It follows similarly constrained growth in Australian farmland values last year, the bank says, with the median price per hectare of all agricultural land types nationally increasing by 0.4 per cent in 2025. While this was a turnaround from a 2.6 per cent decline seen in 2024, it was considerably below the averaged annual growth rate of approximately 11 per cent over the past decade.
Report lead author, RaboResearch commodity analyst Paul Joules said the bank's view was that the market had now transitioned into a new phase, characterised by more moderate growth and that this cycle was likely to persist over the coming years.
"Our base case forecast expects Australian agricultural land values to continue rising in 2026, with the median price per hectare projected to increase by around two per cent year-on-year," he said. "And the expectation is for similarly moderate growth in land values from 2026 to 2031, with the market having firmly entered a weaker growth cycle, driven by higher interest rates and softer commodity pricing."
2025 prices "held firm"
The report said the bank's analysis – of a high-quality data set sampling Australian commercial sales across the country analysed by a team of professional appraisers* – found Australian agricultural land values had "held firm" in 2025. This was despite a complex environment for agricultural commodities across the course of the year, RaboResearch said.
Mr Joules said lower interest rates had likely helped underpin market stability, with the official cash rate cut by 75 basis points over the course of 2025.
Farmland price growth in 2025 was found to have been driven by grazing land, which recorded a three per cent increase in median price per hectare on the previous year. This contrasted with arable (cropping) land values, which declined by one per cent over the same period.
"Land purchasing conditions improved year-on year in 2025," Mr Joules said, "supported by three RBA rate cuts over the year. This made land acquisitions more attractive, particularly in the latter part of the year.
"Strong returns in the livestock sector help explain why most price appreciation occurred in grazing land, while in contrast, negative growth in arable land prices partly reflects deteriorating cropping sector margins, which declined year-on-year."
At the same time, Mr Joules said, farmers had contended with "sticky" input costs through 2025, including elevated fertiliser prices. "However, while grain and oilseed prices were disappointing, a bumper winter crop harvest helped partially offset the impact of lower prices on producers' overall financial performance," he said.
Land price moves varied across the country, the report found, with South Australia and New South Wales showing the largest increases in the median price per hectare of grazing land – at 23 per cent and 22 per cent respectively. New South Wales though also saw the biggest fall in arable land prices in the nation – with the median price per hectare of this land type in the state declining by 11 per cent. Arable land prices in South Australia however increased the most in the year, with median price per hectare up 13 per cent.
2026 – challenging farm budget conditions
Looking ahead, the report said, conditions for farm budgets are challenging in 2026, with farmers under significant pressure from rising input costs and a mixed income outlook across commodity sectors.
