ERS Charts of Note
Thursday, September 1, 2016
With a value of $2.38 trillion, farm real estate (land and structures) accounted for 81 percent of the total value of U.S. farm sector assets in 2014. Because it comprises such a significant portion of the U.S. farm sector?s asset base, change in the value of farm real estate is a critical barometer of the farm sector's financial performance. On average, U.S. (excluding Alaska and Hawaii) farm real estate values increased 2.4 percent (in nominal terms) to $3,020 per acre over the 12 months ending June 1, 2015. Growth in average values has slowed substantially relative to the previous three year mid-year to mid-year periods, when nominal farm real estate values increased over 8 percent annually. National averages mask wide regional variation. Based on nominal values, farm real estate in the Southern Plains and Pacific regions experienced the highest rates of appreciation of 6.1 percent and 5.8 percent (to $1,900 and $4,780 per acre), respectively, over the 12 months ending June 1, 2015. In contrast, farm real estate in the Corn Belt declined 0.3 percent (to $6,350 per acre). This chart is found on the ERS topic page on Land Use, Land Value & Tenure, updated August 2015.
Thursday, September 1, 2016
Double-cropped acreage has varied from year to year. Because decisions about double cropping are made annually, fluctuations are likely as farmers respond to changing market and weather conditions. For example, higher commodity prices give farmers more incentive to intensify production and could offset revenue shortfalls from lower potential yields when double cropping. From 2004 to 2012, total double-cropped acreage roughly paralleled soybean, winter wheat, and corn prices. When commodity prices at the time of planting decisions were increasing or relatively high, total double-cropped acreage also increased. Total double-cropped acreage peaked at 10.9 million acres in 2008, when prices for soybeans, winter wheat, and corn also peaked. In 2005 and 2010, nearly every region witnessed declines in double-cropped acreage amid commodity price declines. This chart is found in the ERS report, Multi-Cropping Practices: Recent Trends in Double-Cropping, EIB-125, May 2014.
Thursday, September 1, 2016
Of the 911 million acres of land in farms in the continental U.S., 61 percent is operated by the land owner, according to the 2014 Tenure Ownership and Transition of Agricultural Land (TOTAL) survey. Another 8 percent (70 million acres) of land in farms is rented from other farm operators. The remaining land in farms (31 percent or 283 million acres) is rented from “non-operating landlords”, or landlord entities that are not currently farmer operators. The majority of acres owned by these non-operating landlords is held by individuals or in partnerships (191 million acres or 21 percent of land in farms). Corporations, trusts, or other ownership arrangements also rent out 92 million acres (about 10 percent of land in farms) to operators. Even though some agricultural land is owned by non-operating landlords, many of these landlords have prior farming experience. Of the 191 million acres owned in non-operator individual or partnership arrangements, nearly half were held by a retired farmer or rancher in 2014. About 6 percent of the acres owned in individual and partnership arrangements by non-operating landlord entities had a principal landlord that reported spending greater than 50 percent of their work time in farm or ranch work, but not as a farm operator. More information can be found on the ERS Farmland Ownership and Tenure topic page.
Thursday, September 1, 2016
Debt use varies with a farm?s commodity specialization, as financing requirements to manage a farm business differ by commodity. Debt-to-asset ratios are a key measure of a farm?s leverage, the degree to which farm assets are financed by debt. Although several measures are necessary to evaluate the financial health of a farm operation, the debt-to-asset ratio is a widely used measure of risk of loan default. Debt-to-asset ratios tend to increase as farm size increases, and they also vary by farm specialization. Large-scale family farms specializing in dairy, and all sizes of poultry farm businesses, are generally more leveraged than farms specializing in the production of other commodities. These specializations generally face higher capital costs, which contribute to increased debt use. Farm businesses specializing in field crops, specialty crops, and beef have the lowest debt-to-asset ratios. This chart is found in ?Farm Businesses Well-Positioned Financially, Despite Rising Debt? in the April 2014 Amber Waves magazine.
Thursday, August 25, 2016
The relatively advanced age of the U.S. farming population?about a third of principal farm operators in 2014 were at least age 65 compared with 12 percent of self-employed workers in nonagricultural businesses?has sparked interest in the manner in which land will be transferred to other landowners, including the next generation of farm operators. Farmland owners planned to transfer 93 million acres in the next 5 years (2015-19)?10 percent of all land in farms?through a variety of means. Landowners anticipated selling 3.8 percent of all farmland, with just 2.3 percent planned to be sold to non-relatives. A larger share of land (6.5 percent) is expected to be transferred through trusts, gifts, and wills. The share of farmland available for purchase by non-relatives during 2015-19 will likely rise above 2.3 percent as some individuals (or entities) that inherit land may choose to sell it. And, those who inherit land but don?t sell it may decide to rent it out to farm operators. In 2014, 39 percent of all farmland was rented and 61 percent was owned by farm operators. This chart comes from the ERS report U.S. Farmland Ownership, Tenure, and Transfer, released on August 25, 2016.
Tuesday, April 12, 2016
The ERS Major Land Uses (MLU) data series provides a snapshot of land use across the United States. While much of the MLU series is updated roughly every 5 years, cropland used for crops, the category representing the acres of land in active crop production, is updated on an annual basis. Cropland used for crops has three main components: cropland harvested (including acreage double-cropped), crop failure, and cultivated summer fallow. In 2015 (the most recent estimate), the total area of cropland used for crops in the United States was 335 million acres, down 6 million acres from the 2014 estimate and about 5 percent below the 30-year average. In 2015, cropland harvested declined by 1 percent (3 million acres) over the previous year. The area that was double-cropped—land from which two or more crops were harvested—declined by 1 million acres, a 13-percent decline from the 2014 double-cropped area of 8 million acres. Acres on which crops failed declined by 30 percent over the past year to 7 million acres, the lowest level since 2010. This chart is based on ERS’s Major Land Uses, summary table 3: Cropland used for crops, updated March 25, 2016.
Monday, December 28, 2015
Of the 911 million acres of land in farms, 61 percent is operated by the land owner, according to the 2014 Tenure Ownership and Transition of Agricultural Land (TOTAL) survey. Another 8 percent (70 million acres) of land in farms is rented from other farm operators. The remaining land in farms (31 percent or 283 million acres) is rented from “non-operating landlords,” or landlord entities that are not currently farmer operators. The majority of acres owned by these non-operating landlords is held by individuals or in partnerships (191 million acres or 21 percent of land in farms). Corporations, trusts, or other ownership arrangements also rent out 92 million acres (about 10 percent of land in farms) to operators. Even though some agricultural land is owned by non-operating landlords, many of these landlords have prior farming experience. Of the 191 million acres owned in individual or partnership arrangements, nearly half were held by a retired farmer or rancher in 2014. Six percent of the acres owned in individual and partnership arrangements by non-operating landlord entities had a principal landlord that reported spending greater than 50 percent of their work time in farm or ranch work, but not as a farm operator. More information can be found on the ERS Land Use, Land Value & Tenure topic page.
Wednesday, November 4, 2015
According to the Tenure, Ownership and Transition of Agriculture Land (TOTAL) survey, 354 million acres of farmland in the lower 48 States were rented to farmers by 2.13 million landlords in 2014. The average amount of land rented out per landlord yields insights into whether rented farmland is concentrated amongst particular types of landlords. Operator landlords—farm operators who rent land to other farmers—typically rented out more acreage than non-operator landlords. Among non-operator landlords, the acres held in corporate, trust, and other types of non-operator ownership arrangements are more concentrated (proportionately more land in fewer hands) than individual and partnership non-operator landlords. The median rented acreage for farmers who rent land from others was 111 acres in 2014—larger than the median acreage rented to farmers by each landlord type. This means that most farm operators looking to rent farmland must instead piece together holdings from multiple landlords. This chart is found in the November 2015 Amber Waves data feature, “Tenure, Ownership and Transition of Agricultural Land (TOTAL) Survey 2014: A New ERS/National Agricultural Statistics Service Data Product.”
Wednesday, October 14, 2015
Because land is a critical input to farming and farm real estate represents such a large portion of the value of farm sector assets (around 80 percent), the ownership of agricultural land is a topic of interest to farmers, lenders, policymakers and others concerned with the farm sector. Issues surrounding production practices and conservation, farm credit, land values, farm succession, land use, and farm structure, all require an understanding of land ownership and tenure. A majority of U.S. land in farms (62 percent) is operator-owned, according to the 2012 Census of Agriculture. The balance of farmland is rented, and the portion of rented land in farms has ranged from 35 percent to 43 percent over the 1950-2012 time period. Some farmland is rented from other farm operations—nationally about 8 percent of all land in farms in 2012. The majority of rented land in farms is rented from nonoperating landlords. In 2012, 30 percent of all land in farms was rented from someone other than a farm operator. This chart is found on the ERS topic page, Land Use, Land Value & Tenure.
Thursday, September 3, 2015
The ERS Major Land Uses (MLU) series estimates land in various uses, including the acres devoted to crop production in a given year. These acres, collectively referred to as “cropland used for crops,” include acres of cropland harvested, acres on which crops failed, and cultivated summer fallow. In 2014 (the most recent estimate), the total area of cropland used for crops was 340 million acres, up 4 million acres from the 2013 estimate but in line with the 30-year average. In 2014, cropland harvested increased by 2 percent (6 million acres) over the previous year. The 317 million acres of cropland harvested represents the highest harvested acreage since 1997, when cropland harvested was 321 million acres. The area double cropped—land from which two or more crops were harvested—declined by 1 million acres, a 10 percent decline from the 2013 double-cropped area of 10 million acres. Acres on which crops failed declined by 25 percent over the past year to 9 million acres, the lowest level since 2010. Cultivated summer fallow, which primarily occurs as part of wheat rotations in the semiarid West, has remained relatively stable over the last 10 years, although its use has been declining since the late 1960s. Larger historical fluctuations seen in cropland used for crops are largely attributable to Federal cropland acreage reduction programs. This chart is based on ERS’s Major Land Uses, Summary table 3: Cropland used for crops, updated August 31, 2015 to include 2014 estimates.
Monday, June 1, 2015
Every year, agriculture contributes an estimated 60-80 percent of delivered nitrogen and 49-60 percent of delivered phosphorous in the Gulf of Mexico. Nitrogen in waters can cause rapid and dense growth of algae and aquatic plants, leading to degradation in water quality as found in the hypoxic zone of the Gulf of Mexico, where excess nutrients have depleted oxygen needed to support marine life. Nitrogen removal is one of the many benefits of wetlands. An ERS analysis found that on an annual basis, the amount of nitrogen removed per dollar spent to restore and preserve a new wetland ranged from 0.15 to 34 pounds within the area of study (the Upper Mississippi/Ohio River watershed), or a range of $0.03 to $7.00 per pound of nitrogen removed. Restoring and protecting wetlands in the very productive corn-producing areas of Illinois, Indiana, and Ohio tends to be more cost effective than elsewhere in the study area. The study suggests that if nitrogen reduction was the only environmental goal, these corn-producing areas would be a good place to restore wetlands. Hydrologic conditions in the Upper Mississippi and Ohio River watersheds are unique, so the cost effectiveness of wetlands elsewhere is uncertain. This map is found in the ERS report, Targeting Investments To Cost Effectively Restore and Protect Wetland Ecosystems: Some Economic Insights, ERR-183, February 2015.
Friday, April 10, 2015
USDA’s costs of restoring and preserving new wetlands across the contiguous United States range from about $170 to $6,100 per acre, with some of the lowest costs in western North Dakota and eastern Montana and the highest in major corn-producing areas and western Washington and Oregon. To analyze conservation program expenditures, ERS researchers generated county-level estimates of wetland costs for each of the major wetland regions as designated by USDA’s Natural Resources Conservation Service (outlined in black in the map), using primarily NRCS Wetland Reserve Program contract data. Variations in costs are driven by differences in land values and the complexity of restoring hydrology and wetland ecosystems. Information about how the costs of restoring and preserving wetlands vary spatially (together with the relative benefits) can inform wetland targeting policies within States/regions and across the U.S. This map is found in the ERS report, Targeting Investments to Cost Effectively Restore and Protect Wetland Ecosystems: Some Economic Insights, ERR-183, February 2015.
Monday, May 20, 2013
Farmers can adapt to their local climate in many ways, including through participation in USDA programs. In regions of the country that face higher levels of drought risk, farmers are more likely to offer eligible land for enrollment in the Conservation Reserve Program (CRP). As a consequence, CRP is both more competitive in these regions and drought-prone counties are more likely to face a binding CRP acreage enrollment cap. When counties are near their enrollment cap, farms are less likely to offer eligible land for CRP because those offers are less likely to be accepted for enrollment. In simulations of offer rates based on observed historical data, a national increase in the county CRP acreage enrollment cap to 35 percent of cropland in each county (from the current level of 25 percent), results in more offers from eligible farmers in drought prone regions of the Great Plains and the Intermountain West. This map is found in the ERS report, The Role of Conservation Programs in Drought Risk Adaptation, ERR-148, April 2013.
Thursday, April 4, 2013
As of mid-August 2012, 43 percent of farms in the United States were experiencing severe or greater levels of drought and another 17 percent were facing moderate levels of drought (for a description of severity levels, see droughtmonitor.unl.edu/classify). A striking aspect of the 2012 drought was how the drought rapidly increased in severity in early July, during a critical time of crop development for corn and other commodities. The chart shows the progression from mid-June to mid-August of severe or greater drought within the agricultural sector. While drought conditions eased some during early September, for most crop production, exposure to drought during June-August determined the drought’s impact on agricultural production. From mid-June to mid-August, the share of farms under severe or greater drought increased from 16 to 43 percent of all farms. Total cropland under severe or greater drought increased from 20 to 57 percent, while total value of crops exposed increased from 16 to 50 percent. As of mid-July, areas with over half of the value of cattle production were already exposed to severe drought; by mid-August, almost two-thirds were exposed. This chart is based on the table found in U.S. Drought 2012: Farm and Food Impacts on the ERS website, updated March 2013.
Thursday, February 28, 2013
Agriculture (including on-farm energy emissions) accounted for about 8 percent of U.S. greenhouse gas (GHG) emissions in 2010. Since farm production represents about 1 percent of total U.S. gross domestic product (in real gross value-added terms), the sector is relatively GHG-intensive. In all U.S. sectors except agriculture, the largest contributor to GHG emissions is fossil fuel combustion for energy. In agriculture, crop and livestock activities are unique sources of nitrous oxide and methane emissions, notably from soil nutrient management, enteric fermentation (a normal digestive process in animals that produces methane), and manure management. These emissions dominate the contribution of energy related emissions in the sector. The land-based activities of agriculture—as well as forestry—also have the unique capacity to withdraw (“sequester”) carbon dioxide (CO2) from the atmosphere and store it in soil and biomass sinks through activities such as no-till on cropland or land use change from croplands to grasslands. EPA estimates that U.S. carbon land-sinks offset close to 15.8 percent of total U.S. emissions in 2010. Agriculture provided 4 percent of U.S. sinks in 2010. This chart updates one found in the ERS report, Economics of Sequestering Carbon in the U.S. Agricultural Sector, TB-1909, March 2004.
Monday, December 31, 2012
Over the last decade, most regions of the country experienced a boom-and-bust cycle in housing values. Because farmland is often the source of land used for new residential construction, changes in housing markets can affect farmland values. The value of farm real estate is typically highest for farmland located less than 10 miles from the borders of a population center, and then tapers off at greater distances. Further, farm real estate values are higher for farmland near larger cities. For example, the average value in 2008 for agricultural parcels within 5 miles of a city of at least 50,000 residents is approximately $16,801 per acre, while the average value for parcels within 5 miles of a town with at least 5,000 residents is $10,705. While the effects of the housing downturn may have the largest impacts on farmland near population centers, residential housing exists even in the most rural areas—so changes in rural housing markets have the potential to affect the values of far more farmland. This chart is found in "Farmland Values on the Rise: 2000-2010" in the September 2012 issue of ERS's Amber Waves magazine.
Monday, November 26, 2012
Direct payments are farm program payments that are based on historical cropping patterns of major commodities, or "base acres," with per-acre rates fixed in legislation and not linked to current production or market prices. Direct payments per acre vary significantly by commodity. In 2008, rice and peanuts received the largest direct payments per acre ($96.25 and $45.85, respectively). Rice base acres were predominant in a few counties along the Gulf Coast and in the Pacific region, while peanut base acres were concentrated in the Southeast. Corn, wheat, and soybeans accounted for more than 80 percent of total base acres in 2008, but received lower direct payments per acre ($24.39 per acre, $15.21 per acre, and $11.54 per acre, respectively). Corn base acres dominated in the Corn Belt, Lake States, the Northeast and Appalachia while wheat base acres were prevalent in the Northern and Southern Plains as well as parts of the Mountain region. This chart is found in the ERS report, Potential Farm-Level Effects of Eliminating Direct Payments, EIB-103, November 2012.
Tuesday, October 9, 2012
While commodity payments have shifted towards farms with more sales, the situation is different for land-retirement payments, which target environmentally sensitive land and largely come from the Conservation Reserve Program. From 1991 to 2009, family farms with sales less than $10,000 (noncommercial farms) nearly doubled their share of land-retirement payments from 16 percent to 30 percent. Over the same period, the average share of acreage enrolled--the ratio of the acres enrolled to total acres operated--increased from 36 percent to 46 percent for participating noncommercial farms. These increases could be attributed to small farms shifting into the noncommercial class following a substantial land retirement and/or older farmers with small commercial farms scaling their operations down by enrolling in the CRP. This chart comes from Changing Farm Structure and the Distribution of Farm Payments and Federal Crop Insurance, EIB-91, February 2012.
Thursday, September 20, 2012
In many areas today, farmland values are influenced by factors other than agricultural productivity, such as urban influence and natural or rural amenities. The capitalized value of expected rents (rental rate divided by 10-year Treasury note) is a broad indicator of the amount of farmland value due to agricultural use. When the ratio of farmland values to capitalized rents exceeds 1.0, it suggests a deviation between the market value of farmland and its implied agricultural use value. In States such as Florida and New Jersey, cropland values greatly exceed their implied agricultural use value. In more rural States such as South Dakota, cropland values are mostly determined by agricultural use. This map can be found in the ERS report, Agricultural Resources and Environmental Indicators, 2012 Edition, EIB-98, August 2012.
Friday, June 22, 2012
Market forces, changes in farm programs, and changes in technology affect the supply and demand for land used for crop production. Between 1949 and 1969, cropland used for crops decreased by 54 million acres and then peaked at 383 million acres in 1982, when no cropland was diverted through Government-acreage reduction programs. Since 1980, cropland used for crops has been relatively stable, despite significant variation in commodity prices. However, relatively stable patterns of changes in land use at the national level obscure larger shifts in land use at regional and State levels. For example, between 1964 and 2007, cropland used for crops increased by 11 million acres in the Corn Belt and decreased by a net 11 million acres in the remaining regions. Both the Northeast and Southeast experienced a long-term decline in cropland used for crops. Urban pressures and a comparative disadvantage in many crops resulted in the conversion of cropland to other uses in these regions. This chart is found in the March 2012 issue of Amber Waves magazine.