Chartered surveyors estimate that the average price per acre increased to £5,950 during the first half of the year, reaching all-time record levels for the second consecutive period.
Interest from potential buyers of commercial farmland continued to surge ahead, with 50 per cent more respondents reporting increases rather than decreases in demand. Surveyors report this is driven largely by increasing demand from commercial farmers looking to expand production on the back of elevated commodity prices.
RICS spokesperson Sue Steer said: "The first six months of 2011 saw farmland prices in the South West increase to record levels once again. With supply of commercial farmland to the market falling away, the growing demand from potential buyers kept prices high across the region. Furthermore, with commodity prices still very high, many commercial farmers appear more keen to expand their businesses rather than sell their land.
"This can only lead to even higher prices over the next 12 months."