| The 2007 Ag Census came out last week. I wrote up some info about American farms through history then. In this diary, I am going to focus on the second largest group of farms - 1000 to 1999 acres.
These farms made up 4.2% of all American farms in 2007 - a slight decline since they peaked at 4.7% in 2002. In 1964, they made up 2.7% of all farms and that percent has gone up throughout history until 2002.
In absolute numbers, there had been a constant increase in farms of this size since 1964 (when there were 84,999 of them), increasing to 102,078 in 1987. They've been on the decline since then. Clearly, the successful farms grew larger and moved into the next largest category by size (farms with over 2000 acres) while the unsuccessful ones went bust and that's the source of these farms' declining numbers. The question is: did more of them grow larger, or did more of them go bust? Are they succeeding financially?
The answer to that question is: YES! These farms are overwhelmingly successful financially. The rough breakdown as I see it is: About 20% of farms of this size are owned by people with other sources of money who do not need to make money with their farms. A very small percent (3.1%) are broke and actually attempting to farm. About half, perhaps slightly more, are really raking in the cash - $250k or more in sales. And an overwhelming majority of these farms are profitable.
These farms may make up only 4.2% of all farms, but their sales represent 17.7% of sales by all farms of any size and their land makes up 13.8% of all farm acres in the U.S. And these farms are totally on the government take. 22% of all government money that goes to farms goes to farms between 1000 and 1999 acres. A farm of this size is more likely than a farm of any other size to receive government subsidies.
So who are these farmers, and what's happening on their farms? |
| The average size of the 92,656 farms of 1000-1999 acres is 1377 acres (about 2 square miles). The average farm had $581,621 in sales but $436,440 in production expenses. The average net income was $161,089. 78% of these farms reported net gains in 2007 (compare that with 47% of all farms of any size that reported net gains). Not so surprisingly, 82.1% of them reported that their principle occupation is farming. 0.6% of these farms were organic - which means that a farm of this size is 1/3 less likely than the average farm to be organic.
So how do the sales break down among these farms?
Sales on Farms with 1000-1999 Acres
(As a Percent of All Farms with 1000-1999 Acres)
| < $1000 | 3.0% | | $1000-$2499 | 0.7% | | $2.5k-$4999 | 1.0% | | $5k-$9999 | 1.7% | | $10k-$24,999 | 4.8% | | $25k-$49,999 | 8.0% | | $50k-$99,999 | 10.3% | | $100k-$249,999 | 16.4% | | $250k-$499,999 | 22.0% | | $500k-$999,999 | 22.3% | | $1mil-$2,499,999 | 7.4% | | $2.5mil-$4,999,999 | 1.6% | | $5mil+ | 0.9% |
As you can see here, the median sales were in the range of $250k-$499,999. Only 11.2% of these farms made under $25k, and 19.2% of them made under $50k. On the other hand, nearly 10% of these farms made more than $1 million in sales, and nearly one third (32.1%) made more than $500k in sales.
More information can be gained by seeing how these farms break down into categories:
Retirement Farms: 8.6%
Retirement farms have market value of
agricultural products sold of less than $250,000,
and a principal operator who reports being
retired.
Residential/Lifestyle Farms: 10.3%
Residential/lifestyle farms have market value of agricultural products sold of less than $250,000, and a principal operator who reports his/her primary occupation as other than farming.
The sum of the 2 above categories is 18.9%, meaning that 18.9% of farmers on farms of 1000-1999 acres are either retired, or have a principle occupation other than farming AND sold less than $250k in agricultural products.
Limited Resource Farms: 3.1%
Limited-resource farms have market value of agricultural products sold gross sales of less than $100,000, and total principal operator household income of less than $20,000.
Farming occupation - lower sales: 10.2%
Farming occupation/lower-sales farms have market value of agricultural products sold of less than $100,000, and a principal operator who reports farming as his/her primary occupation.
If you look at the two above categories, you can see that 13.3% of farmers on farms 1000-1999 acres fall into these categories that sold less than $100k in agricultural products. Fortunately for them, about most are classed as "Farming Occupation - Higher Sales," meaning they have a household income above $20k.
Farming occupation - higher sales: 1.2%
Farming occupation/higher-sales farms have market value of agricultural products sold of between $100,000 and $249,999, and a principal
operator who reports farming as his/her primary
occupation.
Large Family Farms: 21.3%
Large family farms have market value of agricultural products sold between $250,000 and $499,999.
19,732 farms were considered large family farms. 20,379 farms made between $250k and $499,999 in sales. Most likely the 647 farms with this much in sales that aren't counted as family farms are classed as non-family farms.
Very Large Family Farms: 26.6%
Very large family farms have market value of agricultural products sold of $500,000 or more.
By far the most popular category for farms of this size. 24,606 farms were considered very large family farms. 29,723 farms of this size made over $500k in sales. Most likely the approximately 5100 farms that made this much in sales but aren't categorized as very large family farms are counted as non-family farms.
Non-Family Farms: 7.4%
Nonfamily farms are farms organized as nonfamily corporations, as well as farms operated by hired managers.
6881 farms of this size were non-family farms. We know that about 650 of them made between $250k-$499k, and an additional 5100 or so made over $500k. This leaves only about 1100 non-family farms who made under a quarter million dollars.
Government Subsidies
These farms were totally on the government take in 2007. Over 3/4 (78.4%) of farms 1000-1999 acres received government cash, compared to 38% of farms who received government money overall. The average farm 1000-1999 acres who received money got $24,166.53, compared to the average payout of only $9522.91 to farms of any size.
All in all, these farms made up 8.7% of all farms receiving government money. They received 22% of the money the government paid to farms in 2007.
Direct Sales to Consumers
6.2% of all farms sold directly to consumers in 2007, but only 2.3% of farms 1000-1999 acres did so.
These farms made up only 1.2% of all farms who sold directly to consumers, but their direct sales in dollars made up 4.1% of all direct sales. The average amount that a farm 1000-1999 acres made in direct sales was $30,598.30. This is far larger than the average amount farms in general made in direct sales ($8853.21) - i.e. number of farms who engaged in direct sales divided by amount of dollars in direct sales all farms made. Still, $30k is a very small percent of the average farm of this size's sales. Even a farm of this size that engages in direct sales still makes most of its money another way. |
