The total area of agricultural land in Australia with a level of foreign ownership has fallen by 10 per cent over 12 months.
The Australian Taxation Office reported the agricultural land area with foreign ownership dropped from 53 million hectares at June 30, 2021, to 47.7 million ha to June 30 last year.
"This decline is attributed to a large amount of land holdings reacquired by Australian owners," the ATO report tabled in federal parliament said.
"In addition, the proportion of land used for agricultural purposes reported by the ABS increased compared to the prior year.
"The increase reflects the easing of drought conditions, particularly in the eastern states, as well as improved seasonal conditions."
The report found more than 85 per cent of agricultural land with foreign ownership was used for livestock, while 82 per cent was held on a leasehold basis.
By country, China had the largest holding of total Australian agricultural land (two per cent), followed by the United Kingdom (1.9 per cent), Canada (0.7 per cent), the US (0.6 per cent) and Netherlands (0.6 per cent).
The biggest changes in foreign-held agricultural land across the states occurred in South Australia (down 35.8 per cent) and Western Australia (down 22.9 per cent), while in the Northern Territory it rose 1.8 per cent over the 2021/22 financial year.
Total agricultural land stood at 387.3 million ha across the country in June 2022.
Meanwhile, the tax office reported the total volume of foreign-held water entitlements had slightly risen, from 4389Gl at June 2021 to 4503Gl at June 2022.
The office estimated 11.3 per cent of water entitlements in Australia had a level of foreign ownership.
The top four water entitlement holders by country were Canada (2.1 per cent), the US (1.8 per cent), China (0.8 per cent) and the UK (0.8 per cent).
Just over half (51.5 per cent) of all foreign-held water entitlements were within the Murray-Darling Basin.
