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Multiple-operator farms are prevalent among large and very large family farms

Friday, October 25, 2013

Commercial-sized farms often require more management and labor than an individual can provide. Additional operators can provide the necessary labor and management, and possibly other resources such as capital or farmland. Having a secondary operator may also provide a successor when an older principal operator phases out of farming. Multiple-operator farms are particularly prevalent among large and very large family farms. In 2011, 42 percent of all U.S. farms were multiple-operator farms, while 73 percent of very large family farms had more than one operator. Because farms are generally family businesses, one would expect family members to serve as secondary operators. In fact, 73 percent of all secondary operators were spouses. About 12 percent of all multiple-operator farms (and 5 percent of all farms) were multiple-generation farms in 2011, with at least 20 years' difference between the ages of the oldest and youngest operators. The presence or absence of younger related operators may affect farm expansion and contraction decisions, depending on the principal operator's lifecycle position. This chart is found in the ERS topic on Farm Structure and Organization, updated September 2013.

The distributions of women-operated farms and farm sales differ widely among commodity specializations

Friday, June 7, 2013

According to the most recent Census of Agriculture, women-operated farms—farms where a woman was the principal operator—numbered 306,200 in 2007 (13.9 percent of all U.S. farms). Most women-operated farms (about 62 percent in 2007) specialized in grazing livestock or miscellaneous crops, but these are mostly small operations that contributed relatively little (16 percent) to the total sales of women-operated farms. A large majority of women-operated grazing livestock farms and ranches had less than $10,000 in annual sales, and 98 percent of miscellaneous crop farms had no sales in 2007. Most sales by women-operated farms (nearly 72 percent in 2007) came from farms specializing in poultry and eggs, specialty crops, grains and oilseeds, and dairy. While accounting for only about 20 percent of women-operated farms, average annual sales exceeded $130,000 for farms with these specializations. This chart is found in the May 2013 Amber Waves.

Women-operated farms and ranches increased in all sales classes between 1982 and 2007

Thursday, May 2, 2013

The total number of women-operated farms—where the person most responsible for day-to-day business decisions is a woman—more than doubled between 1982 and 2007. In addition, each sales class (adjusted for price changes) experienced a gain. In contrast, the number of men-operated farms declined by 10 percent, and men-operated farms increased in only the largest and smallest sales classes. Since the number of women-operated farms grew more rapidly than that of men-operated farms in each sales class, women principal operators increased their share of farms in every sales class during the past 25 years. Women operators accounted for 14 percent of all farms, but their share of farms with no or very low sales was even larger, at roughly 21 percent. For sales exceeding $100,000, however, women’s share of farms remained small, in the 4- to 5-percent range. This chart is found in the ERS report, Characteristics of Women Farm Operators and Their Farms, EIB-111, April 2013.

Farms involved in rural development related activities vary by type of activity

Thursday, March 28, 2013

While rural development efforts generally focus on the nonfarm economy in the United States, over the last 10 years, several USDA Rural Development programs have put increased emphasis on funding farm-related business activities associated with renewable energy, local/regional food industries, and the use of farm and ranch natural resources. Using data from the 2007 Agricultural Resource Management Survey, the characteristics of farms involved in organic farming, value-added agriculture, direct marketing, agritourism, and energy/electricity production are compared in this chart. Household wealth and income are important indicators of financial capacity, or the ability to make financial investments in farm activities. Average farm household net worth was highest for agritourism farms ($2.0 million) and lowest for direct marketing farms ($631,000). Total household income exhibited a different pattern and was highest for energy/electricity farms ($165,000 annually) and value-added farms ($90,000 annually), on average. The income generated by these rural development-related activities is considered part of farm income (which was highest, on average, for energy/electricity and organic farms, and negative for agritourism farms). This chart comes from the ERS report, Farm Activities Associated With Rural Development Initiatives, ERR-134, May 2012.

Beginning farmers are less likely to inherit or purchase land from a relative than are established farmers

Wednesday, March 20, 2013

Beginning farms (those with an operator with 10 or fewer years of experience) made up 21 percent of all family farms in 2010, and since they are smaller, on average, than established farms, they accounted for 10 percent of the value of production on family farms. Beginning farmers often report that their biggest challenge getting started in farming is access to enough capital and farmland to operate at a size capable of earning a sufficient profit. Not surprisingly, beginning farm operator’s households have lower farm and nonfarm net worth than established farm households. While most beginning farms include some operator-owned land, they are more likely than established farms to have only rented land. For U.S. farmers, in general, the most common way to have acquired “owned land” for their operation is to have purchased it from a nonrelative. But established farms of all size classes are more likely than beginning farms to have inherited or purchased their owned land from relatives. This chart is drawn from Beginning Farmers and Ranchers at a Glance.

Beginning farms participate less than established farms in Government farm payment programs

Friday, February 22, 2013

Consistent with their commodity specializations, beginning farms—those whose operators have 10 or fewer years of farm operator experience—are less likely than more established farms to participate in Government direct-payment programs. Most farm programs focus on cash grain production while relatively few beginning farms specialize in cash grains. As a result, while they represented 22 percent of all farms in 2011, beginning farms accounted for only 14 percent of all farms that received Government payments, and received only 9 percent of all payments that year. However, beginning farmers and ranchers do avail themselves of other farm programs targeted at their needs, including farm loans, the Conservation Reserve Program’s Transition Incentive Program, and the Beginning Farmer and Rancher Development Program. This chart is found in the ERS report, Beginning Farmers and Ranchers at a Glance, EB-22, January 2013.

Small family farms account for most U.S. farms and a majority of farm assets

Wednesday, February 6, 2013

Ninety-seven percent of U.S. farms are family farms where the majority of the business is owned by the operator and individuals related to the operator. The remaining 3 percent are nonfamily farms, which produced 15 percent of the value of agricultural output in 2011. Two features of family farms stand out. First, there are many small family farms (having less than $250,000 in annual sales); together, they account for 87 percent of all U.S. farms. Second, large-scale family farms account for most of the Nation’s agricultural production—70 percent in 2011, as measured by value of output. The share of farm assets held by small farms is substantially higher than their 15-percent share of production. Small-scale family farms hold about 56 percent of all farm assets. The disproportionate asset holdings of smaller farms reflects their overinvestment, particularly in land and dwellings, for purposes other than production, and economies of size enjoyed by larger farms that allow them to produce more with the resources they control. This chart updates one found in the 2010 Edition of the ERS report, America’s Diverse Family Farms, with 2011 Agricultural Resource Management Survey data recently added to the ERS Web tool.

Many farm operators are retirement age

Thursday, January 24, 2013

One of the most striking characteristics of U.S. principal farm operators—the operator most responsible for running the farm—is their advanced age. In 2011, about 32 percent of principal farm operators were at least 65 years old, compared with less than 11 percent of nonagricultural self-employed U.S. workers. Not surprisingly, retirement farms--those operated by farmers who consider themselves retired--had the highest percentage of older operators (72 percent). Among the principal operators of larger family farms (those with annual sales of at least $250,000) and operators of smaller farms that consider farming their primary occupation, the share of older operators declines as farm size increases. Thirty-eight percent of low-sales farm (under $100,000 in sales per year) operators are at least 65 years old, while 17 percent of operators running very large farms (with annual sales of $500,000 or more) are that old. The advanced age of so many farm operators is understandable given that the farm is the home for most farmers and they can phase out of farming gradually. This chart updates one found in the ERS report, America’s Diverse Family Farms, 2010 Edition, with data from the 2011 Agricultural Resource Management Survey, added to the ERS Web tool in November 2012.

Young operators are not uncommon on farms involved in rural development-related on-farm activities

Monday, August 13, 2012

Five on-farm rural development-related activities were examined in a recent ERS study. Using data from the 2007 Agricultural Resource Management Survey, the characteristics, such as operator age, of farms participating in organic farming, value-added agriculture, direct marketing, agritourism, or renewable energy/electricity production were considered. With the exception of agritourism farms, younger farmers (under 45 years of age) were more likely to operate development-related farms than they were for all other farms. Young operators were most common on energy/electricity farms (26 percent). Older farmers (65 years of age and older) played a larger role as operators of agritourism farms (40.4 percent) than for the other farm activities. This chart comes from Farm Activities Associated With Rural Development Initiatives, ERR-134, May 2012.

Household income for beginning farms is high due to off-farm sources of income

Thursday, August 9, 2012

In 2010, beginning farms or ranches accounted for 21 percent of family farms, 10 percent of the value of production by family farms, and 9 percent of acres operated by family farms. The average income of families operating beginning farms was nearly $93,000, which is significantly higher than the average household income for families with established farms (roughly $82,000). On average, beginning farms lost money farming and relied entirely on their off-farm income sources. However, beginning farms that were larger in size, had a principal operator whose major occupation was farming, specialized in crop commodities, dairy, or poultry, participated in government direct payment programs, or engaged in production and marketing contracts were more likely to have positive farm incomes. This chart is from the Beginning & Disadvantaged Farmers topic page on the ERS website, updated May 29, 2012.

Age of principal operator varies with amount of farm sales

Friday, June 29, 2012

In 2007, roughly 30 percent of principal farm operators were at least 65 years old. In contrast, farmers less than 35 years old made up roughly 5 percent of principal operators. Older operators' share of farms declined with sales class, reflecting their gradual withdrawal from farming. For example, older operators accounted for more than 30 percent of farms with sales up to $99,999, but only 17 percent of farms with sales greater than $500,000. The prevalence of older farm operators in smaller sales classes is understandable given the low sales requirements to qualify as a farm. Most operators live on their farm, and farmers can phase out of farming over a decade or more while easily retaining enough land or livestock to produce $1,000 in sales. Improved health and advances in farm equipment also allow operators to farm later in life than in past generations. The data for this chart is found in the ERS report, The Changing Organization of U.S. Farming, EIB-88, December 2011.

Farm populations targeted by USDA programs

Thursday, May 17, 2012

The 2008 Farm Act established or modified several USDA farm programs to increase the participation of beginning farmers or ranchers, women and minority principal operators (so-called socially disadvantaged farmers), and limited-resource farmers (based on their low farm sales and household income), In 2010, 39 percent of all family farms were classified as one or more of these targeted farm groups. They are less likely to participate in government farm payment programs than other farm households (25 compared to 42 percent) and they receive a small share (28 percent) of the total payments relative to their numbers (39 percent of all family farms). However, the share of payments they receive is on par with their share of the total value of agricultural products they produce (17 compared to 16 percent). This chart appears in Beginning Farmers, Demographics, and Labor Allocations, part of the Farm Household Economics and Well-Being topic on the ERS website, updated November 2011.

Beginning farmers are located across the country

Tuesday, April 17, 2012

USDA defines beginning farmers and ranchers as those who have operated a farm or ranch for 10 years or less either as a sole operator or with others who have operated a farm or ranch for 10 years or less. Beginning farmers are located across the country. In some counties, more than half of all farms are beginning farms. A variety of factors affect the share of farmers classified as beginning in any particular county. Access to farmland affects the number of beginning farmers, and access is affected by competition for land. Urbanization also affects resource allocations for beginning farms, many of which rely on proximity to off-farm job opportunities and access to specialized farm markets. This map is found in the ERS report, Beginning Farmers and Ranchers, EIB-53, May 2009.

Small farms with direct sales often engage in other onfarm activities

Wednesday, February 15, 2012

Small farms (those with less than $50,000 annual sales) accounted for about 85% of all farms reporting direct sales of food to consumers in 2007 (about 116,000 farms). Within this group, direct sales accounted for over 35 percent of total farm sales, on average. Bundling other farm income generating activities (separate from basic commodity production) with direct food sales appears to be an important strategy for small farms. For example, 49 percent of all small farms engaged in organic production also reported direct sales to consumers, as did 33 percent of all small farms participating in community supported agriculture, and 28 percent of all small farms that produced value-added goods on the farm, such as processed products. Small farms appear to exploit complementarities between these activities and direct-sales ventures. For the other onfarm activities, the link with direct sales does not appear as strong. For example, only 8 percent of all small farms operating agritourism enterprises also sold directly to consumers. This chart is found in the ERS report, Local Food Systems: Concepts, Impacts, and Issues, ERR-97, May 2010.

Farms involved in local food sales differ from those that do not sell food locally

Monday, December 19, 2011

Farms reporting local food sales require more operator time, on average, than do farms without local food sales. The average farm with local food sales required 1.3 full-time equivalent (FTE) operator jobs (1 FTE job equals 2,000 hours worked annually), compared with 0.9 FTE operator job for farms without local food sales. This pattern held across farm sizes up to $250,000 in annual sales. For larger farms, there was no difference between the average number of FTE operators on farms with and without local food sales. Since the operators of large farms often market local food through intermediated channels, they may not face the same degree of labor intensity as operators selling directly to consumers. This chart is found in the December 2011 issue of Amber Waves magazine.

Urban areas prove profitable for farmers selling directly to consumers

Wednesday, June 8, 2011

Urban markets seem to be especially targeted by farmers engaged in direct sales. Fully 84 percent of farms that sell directly to consumers are located in metropolitan counties or in adjacent rural counties, and these farms accounted for 89 percent of the direct sales income reported by farm operators in 2007. Average direct sales value per farm decreased for farms located progressively farther from urban centers: from $10,987 for farms located in metropolitan counties, to $6,767 for farms in adjacent rural counties, and to $6,090 for farms in remote rural counties. This chart was first published in the September 2010 issue of Amber Waves magazine.

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