ERS Charts of Note
Tuesday, September 17, 2019
In March 2019, historic flooding led to a major disaster declaration covering 121 counties in Iowa and Nebraska. The disaster declaration covers nearly half of the population in Iowa and 93 percent of the population in Nebraska. Of the 3.3 million people living in one of the designated disaster counties in 2017, over 37 percent (1.2 million) lived in rural areas. In 2017, Iowa and Nebraska were the second- and fourth-ranked States, respectively, in agricultural cash receipts. Iowa also ranked second in total agricultural exports and was the top exporter of soybeans, pork, corn, and feed grains. Nebraska led the Nation in beef and veal exports, and ranked third among States in corn, processed grain products, and feed grain exports. Based on the 2017 Census of Agriculture, designated disaster counties produced 66 percent of the market value of agricultural products sold in Iowa and 75 percent of those sold in Nebraska. Together, the designated disaster counties accounted for 9.2 percent of the total U.S. market value of agricultural products sold in 2017. This chart uses data from the ERS State Facts Sheet data product, updated March 2019. This Chart of Note was originally published April 25, 2019.
Thursday, September 12, 2019
Farms of different sizes rely on different mixes of labor. During the 5 years encompassing 2013–2017, the principal operator and the operator’s spouse provided most of the labor hours (75 percent) used on small farms—those with annual gross cash farm income (GCFI) under $350,000. That share fell to 44 percent on midsize farms (GCFI between $350,000 and $999,999), 19 percent on large farms (GCFI between $1 million and $4,999,999), and 2 percent on very large farms (GCFI of $5 million or more). Large and very large farms relied most on hired labor, which provided 64 and 69 percent of the labor hours on those farms, respectively. By comparison, hired labor provided about 12 percent of labor hours on small farms and 39 percent on midsize farms. Small and midsized farms are more numerous, but account for less production overall. Overall, principal operators and their spouses provided 47 percent of the labor hours used on U.S. farms in 2013–17, while hired labor provided 35 percent, and other operators and other unpaid family labor provided another 9 percent of total hours, the same share as contract labor (workers employed by firms hired by the farm). Contract laborers were particularly important on very large farms, contributing over 27 percent of labor hours. This chart updates data found in the March 2018 ERS report, Three Decades of Consolidation in U.S. Agriculture. This Chart of Note was originally published April 15, 2019.
Friday, August 30, 2019
Inflation-adjusted U.S. net cash farm income is forecast to increase $5.8 billion (5.4 percent) to $112.6 billion in 2019, while U.S. net farm income (a broader measure of farm sector profitability that incorporates noncash items including changes in inventories, economic depreciation, and gross imputed rental income) is forecast to increase $2.5 billion (2.9 percent) from 2018 to $88.0 billion in 2019. The forecast increases are due to a combination of lower production expenses, which are subtracted out in the calculation of net income, as well as increases in government payments and farm-related income. These contributions are expected to more than offset the forecast decline in cash receipts. If forecast increases are realized, net farm income would be 2.3 percent below the 2000–18 average ($90.1 billion), but net cash farm income would be 4.0 percent above its 2000–18 average ($108.3 billion). Find additional information and analysis on ERS’s Farm Sector Income and Finances topic page, reflecting data released August 30, 2019.
Friday, August 23, 2019
Errata: On August 26, 2019, the chart’s vertical axis labels were adjusted to accurately align with their corresponding horizontal lines.
The share of women farmworkers fell during the Great Recession—from 18.7 percent in 2007 to 17.6 percent in 2009—as the nonfarm economy declined and more men moved into agriculture. As nonfarm job prospects improved, however, many men left agriculture and the share of women farmworkers recovered and continued growing steadily, reaching 25.0 percent in 2017. This rising share may have been facilitated in part by labor-saving technologies that decreased the physical burdens placed on farmworkers. As wages rose, some growers adopted mechanical aids, such as hydraulic platforms (which replace ladders in tree-fruit harvesting) and mobile conveyor belts (which reduce the distance heavy loads must be carried). These aids may have allowed more women and older workers to perform tasks historically performed by younger men. The average age of all farmworkers also rose from 36.2 years in 2007 to 38.8 years in 2017. This chart appears in the ERS topic page for Farm Labor, updated June 2019.
Thursday, August 8, 2019
The Agriculture Improvement Act of 2018 (2018 Farm Act) was signed into law December 20, 2018, and will remain in force through the end of fiscal year 2023, although some provisions extend beyond 2023. The Congressional Budget Office (CBO) projected that the new Farm Act would mandate spending of $428 billion dollars over the next 5 fiscal years (2019-2023). A large majority of projected spending—76 percent ($326.02 billion)—would fund nutrition programs, with most going to the Supplemental Nutrition Assistance Program (SNAP). Crop insurance ($38.01 billion), farm commodity programs ($31.44 billion), and conservation programs ($29.27 billion) accounted for nearly all of the remaining outlays. Approximately 0.8 percent ($3.54 billion) would fund all other programs, including trade, credit, rural development, research and extension, forestry, energy, horticulture, and miscellaneous programs. Overall, the 2018 Farm Act made fewer changes to food and farm policy than the 2014 Farm Act. Nutrition policy, particularly SNAP, continued with minor changes. Crop insurance options and agricultural commodity programs continued largely as under the 2014 Farm Act. All major conservation programs continued, although some were modified significantly. This chart appears on the USDA Website page, “The Agriculture Improvement Act of 2018: Highlights and Implications,” dated December 20, 2018. This Chart of Note was originally published January 28, 2019.
Thursday, August 1, 2019
Survey data show that the more time a household allots to its farm operation, the less time is available for off-farm employment. Many farm operations require primarily part-time or seasonal work, which can allow household members to work off-farm with little interruption to the farming operation. Across all farms by commodity type, average onfarm hours worked by the principal operator in 2016 ranged from 16 hours per week for general crop farms (where no one crop accounted for a majority of the value of production) to 64 hours per week for dairy farms. Time spent working on the farm limits the time available not only for off-farm employment but also for housework, family, sleep, and leisure activities. Accordingly, the amounts of time spent working on and off the farm are negatively correlated across all commodity types. For example, dairy farmers, who tend to have the most rigid farm schedules, work only 6 hours per week off-farm on average. By comparison, beef cattle farmers tend to have highly flexible schedules and, consequently, spend an average of 20 hours per week working off-farm. This chart updates data found in the August 2018 ERS report, Economic Returns to Farming for U.S. Farm Households. Survey data is drawn from the 2016 Agricultural Resource Management Survey (ARMS), jointly administered by the National Agricultural Statistics Service and the Economic Research Service. This Chart of Note was originally published February 14, 2019.
Monday, July 22, 2019
Farm sector debt has reached levels near the peak levels of the late 1970s and early 1980s. High levels of debt increase a farm’s risk of going out of business. From 1993 to 2017, real (inflation-adjusted) farm debt increased by 87 percent, or 4 percent per year on average. ERS forecasts farm debt to increase 2 percent in both 2018 and 2019. When adjusted for inflation, total farm sector debt in 2019 is forecast to be 4 percent ($4 billion) below the peak reached in 1980. Interest paid on farm debt remained relatively stable from 1990 through 2013, as interest rates declined. However, interest expenses in 2019 are forecast to increase 38 percent ($6 billion) compared to 2013. Interest expenses in 2019 are forecast to be 18 percent above the 30-year average, 19 percent above the 10-year average, but 55 percent below the peak in 1982. This chart updates data found in the July 2018 Amber Waves feature, “Current Indicators of Farm Sector Financial Health.” Find additional information and analysis on ERS’s Farm Sector Income and Finances topic page.
Friday, July 12, 2019
Contracts are widely used in the production and sale of U.S agricultural commodities. Contracts provide farmers with a tool for managing income risks. Farmers also use contracts to obtain compensation for higher product quality, specify outlets for products, and provide assurance of sales for debt financing. Processors use contracts to ensure timely flows of inputs and greater control over the characteristics and consistency of the products they acquire. In 2017, 49 percent of livestock were raised under contract agreements—usually between farmers and processors—while contracts governed 21 percent of crop production. The share of crops produced under contract has declined in recent years as farmers turned to other methods for managing risks, such as diversification, hedging through futures markets, and investing in storage. This chart appears in the December 2018 report America’s Diverse Family Farms: 2018 Edition and the July Data Feature of the ERS Amber Waves magazine, “Marketing and Production Contracts Are Widely Used in U.S. Agriculture.”
Tuesday, July 9, 2019
Historically, public institutions often played a direct role in developing new agricultural technologies and encouraging their commercialization and adoption by farmers. Levels of public investment in research and development (R&D) increased through the early 1980s. However, since then, growth rates in public-sector R&D have been generally low. Until 2003, private-sector investment was comparable to, or moderately higher than, public-sector investment—though growth in private-sector investment had been more variable. After 2003, however, public and private research investments began to diverge rapidly. Total private agricultural and food R&D doubled between 2003 and 2014, while public R&D fell. By 2010, private R&D for agricultural inputs alone surpassed the public level for all agricultural research, which also includes research in areas not directly related to crop and livestock production. Public and private agricultural research efforts are often complementary, rather than competitive. The private sector focuses mainly on R&D related to marketable goods and technologies, with a large share of investments going to the food manufacturing industry, which has little impact on agricultural productivity. The private sector also dominates farm machinery research. On the other hand, public-sector research efforts are more likely to be applied to areas with large social benefits, such as environmental protection, nutrition, and food safety. This chart appears in the ERS data product Agricultural Research Funding in the Public and Private Sectors, updated February 2019.
Tuesday, June 25, 2019
Nationally, 4.3 percent of farmland operators and 4.9 percent of non-operator landlords in 2014 reported receiving oil and gas payments. In counties that produced oil or gas that year, about 10 percent of operators and 13 percent of non-operator landlords reported receiving this income. Not all operators or non-operator landlords own their oil and gas rights, and of those who do, not all of them choose to lease out these rights to energy companies for oil and gas production. Out of those who reported owning oil and gas rights with positive value, non-operator landlords were 21 percentage points more likely than operator landowners to lease their rights to energy firms. Non-operator landlords who lived in the same county as their tenant were more likely to allow energy development to occur than non-operator landlords who lived in a different county. Operator landowners, who live on the property and farm it, may be less likely than non-operator landlords to lease their oil and gas rights because they would experience the costs associated with drilling and oil and gas production—including air pollution, increased truck traffic, and risk of water and soil contamination. This chart appears in the June 2018 ERS report, Ownership of Oil and Gas Rights: Implications for U.S. Farm Income and Wealth.
Friday, June 14, 2019
The composition of family farm household income varies by the type of farm. For example, households operating commercial family farms earned most of their income on the farm ($225,264 on average in 2017). Residence family farm households relied mostly on off-farm wages and salaries ($69,493 on average). Intermediate family farm households, meanwhile, had relatively high retirement and disability income ($19,222 on average), in part because these households had the oldest principal operators on average. Less than half of all farm households had positive incomes from their farm operations in 2017. Among commercial farm households, 86 percent had positive income from farming, compared to 51 percent of intermediate farm households and 35 percent of residence farm households. At the median, U.S. farm households earned $67,500 from non-farm sources, compared to a median loss of $800 from farming operations. This chart appears in the Amber Waves infographic “Farm Households Rely on Many Sources of Income,” published June 2019.
Thursday, May 23, 2019
Farm real estate (including farmland and the structures on the land) accounts for over 80 percent of farm-sector assets and represents a significant investment for many farms. Beginning in the mid-2000s, higher farm incomes and lower interest rates contributed to rapid appreciation. Nationally, average per-acre farm real estate values more than doubled when adjusted for inflation, from $1,483 in 2000 to $3,010 in 2016. Two major uses of farmland are cropland and pastureland. From 2003 to 2014, U.S. cropland values doubled, appreciating faster than pastureland and reflecting a rise in grain and oilseed commodity prices. However, the value of cropland and farm real estate dipped slightly in 2008–09, reflecting the effect of the Great Recession and the downturn in the U.S. housing market. In contrast, average U.S. pastureland values remained relatively flat. This chart appears in the February 2018 ERS report, Farmland Values, Land Ownership, and Returns to Farmland, 2000–2016.
Wednesday, May 8, 2019
Between 2006 and 2017, the average age of hired farm laborers (excluding managers, supervisors, and other supporting occupations) has risen 8 percent—from 35.8 years to 38.8 years. This increase has been entirely driven by the aging of foreign-born farm laborers, who made up between 54 and 58 percent of the workforce over this period. Their average age rose 16 percent, from 35.7 in 2006 to 41.6 in 2017. In contrast, the average age of farm laborers born in the United States (including Puerto Rico) has remained roughly constant. The main reason for the aging of the foreign-born farm laborer population has been the decline (starting in 2008) in the flow of new immigrants, who tend to be younger. One response to the aging of the farm workforce has been to increase the use of mechanical aids, such as hydraulic platforms to replace ladders in orchards and mobile conveyor belts to reduce the distance that heavy loads must be carried in the fields. These changes may enable workers to prolong their careers, and may also make it easier for more women to work in agriculture. This chart appears in the ERS topic page for Farm Labor, updated December 2018. It is also in the Amber Waves article, “U.S. Hired Farm Workforce Is Aging,” published in May 2019.
Friday, May 3, 2019
Agriculture, food, and related industries contributed $1.053 trillion (5.4 percent) to U.S. gross domestic product (GDP) in 2017. This total represents a decline of $7.9 billion, or 1 percent of the 2016 total. This decline marks the first such decline in the contribution of agriculture and related industries to U.S. GDP since at least 1997, the first year for which detailed data is available. The output of America’s farms contributed $132.8 billion of this sum—about 1 percent of GDP. The overall contribution of the agriculture sector to GDP is larger than this because sectors related to agriculture (listed in the chart) rely on agricultural inputs. The largest contributor to GDP of these related industries is the “food service, eating and drinking places” category, which in 2017, added roughly $427 billion dollars to U.S. GDP, an increase of 7 percent since 2016. All other categories declined from 2016 to 2017. The largest declines were registered for “food and beverage stores” (down 7 percent) and “forestry fishing and related activities” (down 11 percent). This chart appears in the ERS data product, Ag and Food Statistics: Charting the Essentials, updated in April 2019.
Monday, April 29, 2019
Farm businesses—operations where farming is reported as the operator’s primary occupation or that have at least $350,000 in annual sales—accounted for more than 94 percent of U.S. farm sector production in 2017. That year, farm businesses held 90 percent of all farm assets and 96 percent of farm debt. Debt-to-asset (D/A) ratios measure the amount of assets that are financed by debt, and can indicate a farm’s risk exposure and ability to overcome adverse financial events. The share of farm businesses that are highly leveraged (D/A ratio between 0.41 and 0.70) has fallen since 2015, but is forecast to increase slightly in 2018 and 2019. Farm businesses specializing in crops tend to have higher shares of both highly and very highly leveraged operations (D/A ratio over 0.70) than farm businesses specializing in livestock and animal products. In 2019, ERS forecasts 4.3 percent of crop farm businesses to be very highly leveraged, the highest share since 2002. Lending institutions consider D/A ratios (along with other measures reflecting the likelihood of default) when evaluating the credit worthiness of farms, so some of these highly and very highly leveraged farm businesses may have difficulty securing a loan. This chart updates data from the April 2014 ERS report, Debt Use by U.S. Farm Businesses, 1992–2011.
Thursday, April 25, 2019
In March 2019, historic flooding led to a major disaster declaration covering 121 counties in Iowa and Nebraska. The disaster declaration covers nearly half of the population in Iowa and 93 percent of the population in Nebraska. Of the 3.3 million people living in one of the designated disaster counties in 2017, over 37 percent (1.2 million) lived in rural areas. In 2017, Iowa and Nebraska were the second- and fourth-ranked States, respectively, in agricultural cash receipts. Iowa also ranked second in total agricultural exports and was the top exporter of soybeans, pork, corn, and feed grains. Nebraska led the Nation in beef and veal exports, and ranked third among States in corn, processed grain products, and feed grain exports. Based on the 2017 Census of Agriculture, designated disaster counties produced 66 percent of the market value of agricultural products sold in Iowa and 75 percent of those sold in Nebraska. Together, the designated disaster counties accounted for 9.2 percent of the total U.S. market value of agricultural products sold in 2017. This chart uses data from the ERS State Facts Sheet data product, updated March 2019.
Monday, April 15, 2019
Farms of different sizes rely on different mixes of labor. During the 5 years encompassing 2013–2017, the principal operator and the operator’s spouse provided most of the labor hours (75 percent) used on small farms—those with annual gross cash farm income (GCFI) under $350,000. That share fell to 44 percent on midsize farms (GCFI between $350,000 and $999,999), 19 percent on large farms (GCFI between $1 million and $4,999,999), and 2 percent on very large farms (GCFI of $5 million or more). Large and very large farms relied most on hired labor, which provided 64 and 69 percent of the labor hours on those farms, respectively. By comparison, hired labor provided about 12 percent of labor hours on small farms and 39 percent on midsize farms. Small and midsized farms are more numerous, but account for less production overall. Overall, principal operators and their spouses provided 47 percent of the labor hours used on U.S. farms in 2013–17, while hired labor provided 35 percent, and other operators and other unpaid family labor provided another 9 percent of total hours, the same share as contract labor (workers employed by firms hired by the farm). Contract laborers were particularly important on very large farms, contributing over 27 percent of labor hours. This chart updates data found in the March 2018 ERS report, Three Decades of Consolidation in U.S. Agriculture.
Friday, April 5, 2019
The distribution of U.S. farm production varies by commodity and farm size. In 2017, small family farms—those with annual gross cash farm income (GCFI) under $350,000—produced most of the hay (76 percent) and poultry (60 percent). As a group, small family farms accounted for about 89 percent of all U.S. farms and 26 percent of U.S. agricultural production. By comparison, large-scale family farms—those with GCFI of at least $1 million—produced most of the dairy (68 percent), high-value crops like fruits and vegetables (56 percent), and cotton (55 percent). Large-scale family farms accounted for about 3 percent of all farms and 39 percent of total production. Midsize family farms—those with GCFI between $350,000 and $1 million—contributed large shares of cash grains and soybeans (36 percent), cotton (30 percent), and poultry (29 percent). These midsize farms together accounted for about 6 percent of all farms and 23 percent of total production. Nonfamily farms account for the remaining farms and production. This chart appears in the ERS topic page for Farm Structure and Organization, updated December 2018.
Wednesday, March 27, 2019
The 2018 Farm Bill reauthorizes the Specialty Crop Block Grant Program and extends funding levels through fiscal year 2023. Under the program, block grants are awarded to each State to support State and multistate projects that aim to enhance the competitiveness and long-term success of U.S. specialty crop producers. Specialty crops are defined as fruits and vegetables, tree nuts, dried fruits, horticulture, and nursery crops (including floriculture), whereas non-specialty crops include grains and commodities such as rice, wheat, and dairy products. The specialty crop grant program objectives include: broadening domestic and international markets for U.S. producers, supporting producers with research and development related to specialty crops, increasing market availability and access, and addressing challenges confronting specialty crop producers. Grant projects span topics in marketing, research, pest and disease management, food safety, and the like. The amount of grants awarded to a State is based on production value and acreage in specialty crops. Under the 2014 Farm Bill, grants awarded totaled $329.1 million for fiscal years 2014–18. Nearly half of the total went to California, Washington, and Florida—key fruit- and vegetable-producing States. As the leading producer of fruits and vegetables, California, alone, received 32 percent of the total grant amount. This chart appears in the specialty crops section of Agriculture Improvement Act of 2018: Highlights and Implications, released in February 2019.
Tuesday, March 19, 2019
Past ERS research on consolidation in the U.S. farm sector has documented a widespread shift in agricultural production to large-scale operations. This structural change has likely been partly driven by productivity advantages enjoyed by larger operations. Recent ERS research examined consolidation trends in the Heartland region—which includes all of Iowa, Illinois, and Indiana, and parts of Minnesota, South Dakota, Nebraska, Missouri, Kentucky, and Ohio. Between 1982 and 2012, the Heartland’s largest crop farms (more than 1,000 acres) increased their share of total production in the region from 17 percent in 1982 to 59 percent in 2012. In contrast, over the same period, the share of total production declined for the four smaller farm size categories. Midsized farms (250–500 acres) experienced the largest decline in market share, falling from about 30 percent in 1982 to 10 percent in 2012. In aggregate, the productivity of crop farms in the Heartland region increased by 64 percent, or 1.5 percent per year, between 1982 and 2012. ERS researchers estimate that about one-sixth of this productivity growth was attributable to the shift in production to larger farms. This chart appears in the December 2018 Amber Waves feature “Productivity Increases With Farm Size in the Heartland Region.”