Tuesday, July 15, 2008

Farming: The rich get richer and the big get bigger

The average income of a U.S. farmer is expected to rise to $89,434 this year, up 6.3 percent, in partly because of subsidies in the new Farm Bill. "Most of the bonanza, though, is being scooped up by the big operators," The Economist reports. Patty Coady, whose family has farmed their Nebraska land for more than 100 years, tells the British-based magazine with a huge American circulation, "Small farmers can hardly compete."

Ninety-seven percent of U.S. farms were family-owned in 2006, the last year such figures were available, but "family farm" has an array of translations. Big family farms, those with more than $250,000 annual sales, comprise 7.6 percent of the total and are responsible for 61 percent of the production. Big family farmers earn 68 percent of their income solely from farming, but small farmers must earn most of their income elsewhere. About 63 percent of all farms were owned by retirees or others whose main job was not farming. Twenty-seven percent, including Coady, were small farmers who list their main occupation as farming despite earning most of their income from alternative sources.

"Since the 1930s agricultural innovation and a rise in non-farm employment have driven productivity up and the number of farms down," The Economist reports (with the help of this graph). "Nebraska had 135,000 farms in 1934; last year it had about 47,300. The government's role in this progression is up for debate." Mike Korth, a northeast Nebraska farmer, says, "Change is inevitable, but I don't agree that the government should have a heavy hand in determining that change." Korth and the Center for Rural Affairs, say subsidies aid big farmers in bidding up land prices while making it harder for small farmers to survive.

Young farmers face high entry costs, including land and equipment prices. Approximately 27 percent of farm operators were 65 or older in 2004, compared to 17 percent in 1969. The Council of State Governments says more than 20 states have programs intended to attract young farmers, and the Farm Bill offers assistance, including a program that prioritizes loans for organic farmers. Carolyn Orr of CSG, based in Lexington, Ky., says some niches might help small farmers survive, but the next generation of farmers are likely to face continued consolidation. "If they want to make farming a full-time job, what other options do they have?" she asked. Read more here.

1 comment:

Anonymous said...

Success demands the rich get richer and bigger.

If the USDA would offer serious terms for success and get people involved that understand success from which when a farmer needs help, the system in controling everything, doesn't throw farmers under the bus if you will, then the people can take a look at agriculture in recommending their child gets involved if you will.

The farm bill is about a decade too late and the credit side of agriculture is lacking the much needed attention for success.

It is sad that a business can corner a market before legislation in making a ton of money but is far worse to not see the people involved to protect our future because of what money has done.

It is long over due to re think the greator good philosphy in understanding what has to happen now to prevent the philosphy from failing tomorrow as the market share shifts to countries that develop their agriculture for success.

unemployed white farmer