The latest land reform in Latvia has substantially altered the structure of use of farmland leading to a great number of very small and fragmented agricultural holdings, yet, in terms of occupied total area and UAA, medium size (10.0-50.0 ha) and slightly larger (more than 50.0 ha) land holdings dominate. In Latvia the number of agricultural holdings tends to decline. On the contrary, the average UAA per agricultural holding rose (by 66%), reaching 23.2 ha in 2010. One can conclude that positive structural changes take place in the agricultural industry – the number of small farms has declined and the number of and the area farmed by large marketoriented farms has risen, thus the difference between the sizes of land holdings that emerged during the land reform and the land areas farmed by agricultural holdings has increased.

The paper’s main objective is to analyse the distribution of large farm plots and opportunities for their optimization. In the context of intensive changes in the management and use of agricultural land, it is particularly important to optimise the land holdings of large farms. Most large farms are characterised by a fragmented, uncompacted spatial distribution. 15 large farms were selected for analysis in Jonava municipality. There are 22 separate fields on average per holding, 2/3 of the farm centres (farmsteads) are located in large settlements, and 1/3 of the farm centres are located in one-farm settlements and in small villages. It was found that the average area of individually cultivated fields is 14.9 ha, and the average distance from the farmstead to the fields is 4.35 km. Land holdings are very fragmented – fragmentation coefficient K2 value range from 2.64 to 8.81 (average 3.62) for selected farms. It is proposed to draw up municipality land use planning schemes, which would project the prospective boundaries of land holdings, and to legalize by law the right of pre-emption for the farm owner to acquire the ownership of the plots of land to be sold within these boundaries in order to increase the compactness of farm land holdings. A state can facilitate sporadic land consolidation by farmers through the preparation of the proposed municipality land use planning schemes.

Agricultural land is one of the most valuable natural resources which can be found in Latvia, since agricultural land has long time served as an important resource of economic activity and food production. Efficient use of this valuable resource depends not only on technologies and knowledge at disposal of farmers but also on regulations concerning the real estate market and taxation of the real estate. Recent changes of the real estate market regulation as concerns agricultural land are analysed in this paper to identify a possible influence on the use of agricultural land.