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  • Structure and Finances of U.S. Farms: 2005 Family Farm Report

    EIB-12, May 15, 2006

    Most farms in the United States-98 percent in 2003-are family farms. They are organized as proprietorships, partnerships, or family corporations. Even the largest farms tend to be family farms. Very large family farms account for a small share of farms but a large-and growing-share of farm sales. Small family farms account for most farms but produce a modest share of farm output. Median income for farm households is 10 percent greater than the median for all U.S. households. Small-farm households also receive substantial off-farm income.

  • Growing Farm Size and the Distribution of Farm Payments

    EB-6, March 14, 2006

    Crop production is shifting to much larger farms. Since government commodity payments reflect production volumes for program commodities, payments are also shifting to larger farms. In turn, the operators of very large farms have substantially higher household incomes than other farm households, and as a result government commodity payments are also shifting to much higher-income households. Since the changes in farm structure appear to be ongoing, commodity payments will likely, under current policies, continue to shift to higher income households. This brief uses 2003 Agricultural Resource Management Survey (ARMS) data to detail the shifts.

  • Greening Income Support and Supporting Green

    EB-1, March 14, 2006

    A multitude of design decisions influence the performance of voluntary conservation programs. This Economic Brief is one of a set of five exploring the implications of decisions policymakers and program managers must make about who is eligible to receive payments, how much can be received, for what action, and the means by which applicants are selected. In particular, this Brief focuses on potential tradeoffs in combining income support and environmental objectives in a single program.

  • Farm Cash Margins Expected to Tighten in 2006

    Amber Waves, February 01, 2006

    In 2006, net farm income is forecast to be $56.2 billion, just above its 10-year average of $55.7 billion. Income is forecast to be lower than in 2004-05 due to lower commodity prices, reduced marketing, lower government payments, and increased production costs, especially for energy-based purchased inputs. Payments to laborers, creditors, and landlords are forecast to reach record levels, with most of the increase over 2005 accounted for by interest payments and rising labor costs. This article presents the latest farm income forecasts from ERS.

  • Financial Assistance to Farmers is Evolving

    Amber Waves, November 01, 2005

    The U.S. Government has long provided financial assistance to farmers. Today’s payments, like those of the past, are mostly commodity based. Since farm production is shifting to much larger farms, and because commodity payments follow production, they are increasingly directed to high-income households. Only a small share of government commodity payments now goes to low-income households.

  • Economic Analysis of Base Acre and Payment Yield Designations Under the 2002 U.S. Farm Act

    ERR-12, September 19, 2005

    The 2002 Farm Act provided farmland owners the opportunity to update commodity program base acres and payment yields used for calculating selected program benefits. Findings in this report suggest that farmland owners responded to economic incentives in these decisions, selecting those options for designating base acres that resulted in the greatest expected flow of program payments. Farmland owners with high-payment base acres, such as rice and cotton, held on to these base acres and, whenever possible, expanded them. Analogously, farmland owners with low-payment commodity base acres, such as oats and barley, switched to higher payment commodities whenever possible.

  • Composite Measure of Economic Well-Being

    Amber Waves, September 01, 2005

    ERS has developed a composite measure of economic well-being (CWB) that incorporates the income received from all sources by the farm household with an annuity based on the amount of marketable wealth held by the household. The richness of data collected through USDA's Agricultural Resource Management Survey in recent years allows for a more comprehensive and robust measure of economic well-being.

  • Why Hasn't Crop Insurance Eliminated Disaster Assistance?

    Amber Waves, June 01, 2005

    In 1995, 80 percent of eligible U.S. farm acreage was enrolled in crop insurance. Still, Congress has continued to pass ad hoc disaster assistance measures in reaction to drought and other adverse events. Since 2000, four such programs have been authorized, covering 6 crop years for a total cost of about $10 billion.

  • How Do U.S. Farmers Plan for Retirement?

    Amber Waves, April 01, 2005

    Retirement and succession planning are of considerable importance to farm households and there are good reasons to believe that they are affected by savings and retirement policies in ways that are different from the rest of the Nation's households. This article examines how farmers save for retirement as well as their dependency on social security.

  • Structural and Financial Characteristics of U.S. Farms: 2004 Family Farm Report

    AIB-797, March 09, 2005

    This report presents comprehensive information on family and nonfamily farms and important trends in farming, operator household income, farm performance, and contracting. Most farms are family farms. Even the largest farms tend to be family farms. Small family farms account for most of the farms in the U.S. but produce a modest share of farm output. Average farm household income has been at or above the average for all U.S. households in recent years, with farm households receiving most of their income from off-farm sources.

  • USDA Agricultural Baseline Projections to 2014

    OCE-2005-1, February 11, 2005

    This report provides longrun (10-year) baseline projections for the agricultural sector through 2014. Projections cover agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices.

  • Farm Profit Recedes From Record High While Cash Margins Improve

    Amber Waves, February 01, 2005

    In 2005, net farm income is forecast to be $64.4 billion, down $9.2 billion from the record $73.6 billion estimated for 2004. Income is forecast down in 2005 only because in 2004 income rose $14.4 billion over the previous year to reach an unprecedented level. Most financial indicators for 2005 are forecast to fall between the levels of the two prior successive record years – 2003 and 2004. This article presents the latest farm income forecasts from ERS.

  • Devolution of Farm Programs Could Broaden States' Role in Ag Policy

    Amber Waves, November 01, 2004

    U.S. farms vary greatly in size, specialty, and household characteristics. U.S. regions differ markedly in natural resource endowments. And States themselves are widely divergent in terms of their preferences as to how funds from agricultural programs should be spent. Given this diversity, can the delivery of agricultural programs be better tailored to distinct State and local circumstances? Devolution, or the transfer to States of Federal funds and/or control of those funds, is one way of adapting national policies to suit local preferences more closely and of recognizing that program delivery costs can vary geographically.

  • Contracts, Markets, and Prices: Organizing the Production and Use of Agricultural Commodities

    AER-837, November 01, 2004

    Demand for specific product attributes is making contracts the choice over traditional spot markets for many livestock commodities and some major crops-e.g., sugar beets, fruit, tomatoes.

  • How Do Decoupled Payments Affect Resource Allocations Within the Farm Sector?

    Amber Waves, November 01, 2004

    Most industrialized nations subsidize producers of certain farm commodities with payments linked to commodity prices and production levels. In the U.S., interest in market liberalization and obligations under multilateral trade agreements have prompted policymakers to design and implement less distorting government commodity programs. One step in that direction is to use "decoupled" payments to directly change the income and wealth of farm households without distorting relative commodity prices. Recent analyses indicate how land tenure arrangements influence the amount farm households receive from decoupled payments, and how decoupled payments influence markets for agricultural capital and labor.

  • Peanut Policy Change and Adjustment Under the 2002 Farm Act

    OCS-04G01, July 15, 2004

    This report examines the experience of the peanut sector following the 2002 Farm Act's elimination of the marketing quota system, and identifies factors affecting the transition to a more market-oriented system. Although peanut prices and acreage declined following passage of the 2002 Farm Act, it appears that producers are taking advantage of increased planting flexibility to expand production in higher yielding areas. Moreover, the transition has been cushioned by rising demand, and additional sources of revenue from government payments and other sources of farm and off-farm income.

  • Data Feature

    Amber Waves, June 01, 2004

    The Agricultural Resource Management Survey (ARMS) is USDA's primary vehicle for collecting information on agricultural resource use, production practices, farm costs and returns, farm financial conditions, and the economic well-being of America's farm households. Sponsored jointly by ERS and USDA's National Agricultural Statistics Service (NASS), ARMS was initiated in 1996 as an effort to consolidate and integrate the former USDA cropping practice, chemical use, and farm costs and returns surveys (which date back several decades).

  • Are Bankruptcies Behind the Drop in Farm Numbers?

    Amber Waves, April 01, 2004

    The number of U.S. farms declined by two-thirds between 1935 and 2002. While this decline is commonly associated with high rates of farm bankruptcy, a new study finds the link between dwindling farm numbers and farm bankruptcies to be weak.

  • Farmer Bankruptcies and Farm Exits in the United States, 1899-2002

    AIB-788, March 30, 2004

    The report finds that bankruptcy has played only a small role in the overall decline in farm numbers over the last 70 years. Most of the decline in farm numbers occurred between the 1940s and 1970s, when bankruptcy filings were at relatively low levels. Farm numbers have even risen when bankruptcies have been relatively high or rising, such as during the early 1930s or early 1990s. Not all bankruptcies result in farm exits, and most farm exits involve other factors. Bankruptcies are only one phenomenon within a broader set of changing economic circumstances-including rising agricultural productivity and expanding off-farm opportunities-that influence the size and structure of the farm sector.

  • Risk, Government Programs, and the Environment

    TB-1908, March 26, 2004

    Financial risk permeates nearly all farm business ventures. In some instances, private and public tools used to manage financial risks in agriculture may influence farmers' production decisions. These decisions, in turn, can influence environmental quality. This bulletin synthesizes several research literatures and provides some perspective on private and public attempts to cope with financial risks and their unintended environmental consequences. Specifically, it examines the conceptual underpinnings of risk-related research, challenges involved with measuring the consequences of risk for agricultural production decisions, government programs that influence the risk and return of farm businesses, and how production decisions influence both the environment and the risk and average returns to farming.