Mr Grylls said his department would co-ordinate the review and report to him early next year with recommendations.

"I have asked the department to look at various options with a range of stakeholders including the Valuer-General and the Pastoralists and Graziers Association (PGA)," Mr Grylls said.

"I want the review completed and any changes in place well before the next rent review is due."

The Minister said that under the current system for setting pastoral rents, the Valuer-General reviewed unimproved land values every five years.

PGA policy director Sheldon Mumby welcomed the review of the current pastoral rent system.

"Overall, the PGA is extremely relieved that the Minister is going to be conducting a review on pastoral leases," he said.

"There have been obvious problems with how the rents are assessed and that there needs to be a better formula for determining the value that's a fair and adequate reflection of the economic conditions of the industry."