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Welcome toANR at Noon,
August 28, 2015
State of the Farm: Iowa Trends During the
2000s
David J. Peters, Ph.D.Associate Professor of Sociology
Extension Rural Sociologist
Data and Definitions
Data sources …• Agricultural Resource Management Survey (ERS)• Census of Agriculture (NASS)
What is a farm?$1,000 or more of agricultural products produced and intended for sale.Majority of farm is owned by the operator and individuals related to the operator.
Residence Farms• Under $350k in GCFI & non-farm occupation. Family held.
Intermediate Farms• Under $350K GCFI & farm occupation
Commercial Farms• $350k or more in GCFI
Old definition from 15 years ago. USDA updated typology in 2013.
Most farms are residence/recreation operations
Of 88,500 farms in Iowa …
• 38,700 (44%) are residence farms, declining over time.• 26,400 (30%) are intermediate farms, declining over time.• 23,400 (26%) are commercial farms, growing over past decade.
True farms numberbetween 23k-50k.
44 42 45 4352 47 53 50 51 53 50
30 3235 33
2427
25 33 32 2734
26 26 20 24 24 25 23 18 17 20 16
0
200
400
600
800
1,000
1,200
1,400
0
10
20
30
40
50
60
70
80
90
100
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Acre
s Pe
r Far
m
Perc
ent F
arm
s
Farms in Iowa
Commercial Intermediate ResidenceAcres/Farm Acres/Farm Acres/Farm
Most farms are residence/recreation operations
Commercial farm breakouts …
• Most are mid-size farming about 800 acres.• About 7,000 large farms (1,400 ac/farm).• Few “corporate” farms.• Very few “mega” farms (2,500 ac/farm).
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
38,676
26,421
14,208
6,690
3292,178
0
500
1,000
1,500
2,000
2,500
3,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Acre
s Pe
r Far
m
Farm
s
Farms by Farm Class, Iowa 2013
Farms Acres/Farm
<----------------------- Commerical Farms ----------------------->
Most acres farmed by commercial operations
Of 31.5 million acres of farmland in Iowa …
• 66% in commercial farms (893 ac/farm), grew 42%• 21% in intermediate farms (252 ac/farm), fell -44% • 12% in residence farms (101 ac/farm), fell -43%
66% of land farmed by 23k farmers.
20.906 19.780 19.465 20.092 19.250 21.059 19.59715.512 15.375 16.986
14.685
6.662 7.566 8.336 6.491 5.8955.697 6.430
9.548 10.454 7.821 11.842
3.895 4.392 4.337 4.996 5.6195.206 6.406
5.933 6.2115.900
6.905
0
100
200
300
400
500
600
700
800
900
1,000
1,100
0
5
10
15
20
25
30
35
40
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Acre
s Pe
r Far
m
Acre
s (m
il)
Farm Acerage by Farm Class in Iowa
Acres-Residence Acres-Intermediate Acres-CommercialPer Farm Per Farm Per Farm
Most acres farmed by commercial operations
Commercial farm breakouts …
• 6,700 large farms operate about as many acres (89%) as ALL 65,100 residence and intermediate farms combined.
• Mid-Size and Large farms typical of “true” farms in Iowa.
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
101252
719
1,392
2,365
2790
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
0
2
4
6
8
10
12
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Acre
s Pe
r Far
m
Acre
s (m
il)
Farm Acerage by Farm Class, Iowa 2013
Farms Acres Per Farm
<----------------------- Commerical Farms ----------------------->
Majority of ag production from commercial farms
Of $35.785 billion in agricultural production in Iowa …
• 81% from commercial farms, grew 231% past decade • 13% from intermediate farms, grew 37%• 6% from residence farms, grew 75%
81% of prodfrom only23k farmers.
$28.890$26.475
$22.634 $21.268 $19.910 $20.950$18.592
$12.548 $13.425$16.148
$8.730
$4.520$4.729
$6.688
$2.851$2.637 $2.772
$2.613
$3.016 $3.178$3.264
$3.306
$2.375
$1.764$1.689
$1.406$1.734 $1.265
$1.659
$1.727 $1.030$1.483
$1.358
$0.000
$0.200
$0.400
$0.600
$0.800
$1.000
$1.200
$1.400
$0.000
$5.000
$10.000
$15.000
$20.000
$25.000
$30.000
$35.000
$40.000
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Valu
e Pe
r Far
m (m
il 20
13$)
Prod
uctio
n Va
lue
(bil
2013
$)
Farm Production Value by Farm Class in IowaValue-Residence Value-Intermediate Value-CommercialPer Farm Per Farm Per Farm
Majority of ag production from commercial farms
Commercial farm breakouts …
• 14,000 mid-size farms generate 1.6 times the production as ALL 65,100 residence and intermediate farms combined.
• 6,700 large farms generate 2.0 times the production asALL 65,100 residence and intermediate farms combined.
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
$0.061 $0.171
$0.762
$2.071
$6.993
$0.877
$0
$1
$2
$3
$4
$5
$6
$7
$8
$0
$2
$4
$6
$8
$10
$12
$14
$16
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Valu
e Pe
r Far
m (m
il 20
13$)
Prod
uctio
n Va
lue
(bil
2013
$)
Farm Production Value by Farm Class, Iowa 2013
Farms Value Per Farm
<----------------------- Commerical Farms ----------------------->
Commercial farms are highly profitable
Commercial NCFI $410,650/farm, grew by 130% last decade.
Intermediate NCFI $28,516/farm, grew by 8% (farmer primary occupation!)
Residence NCFI $12,515/farm, grew by 102% (non-farmer occupation!)
Iowa only has 23k“true” farms, in theconventional sense.
$410.648
$409.332
$236.533$234.608
$212.402$184.873
$256.672
$183.296
$306.272$289.525
$178.278
0
5
10
15
20
25
30
35
40
45
50
55
60
$0
$50
$100
$150
$200
$250
$300
$350
$400
$450
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Perc
ent F
arm
s
Net
Far
m In
com
e (1
000s
201
3$)
Net Farm Income Per Farm by Farm Class in IowaNFI-Commercial NFI-Intermediate NFI-ResidencePct Farms Pct Farms Pct Farms
Commercial farms are highly profitable
$12,515 $28,516$218,711
$735,724
$3,463,030
$203,220
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Net
HH
Inco
me
Net Farm Income Per Farm by Farm Class, Iowa 2013
<----------------------- Commerical Farms ----------------------->
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
Commercial farm breakouts …
• 330 very large farm generate about as much NFCI (92%) asALL 65,100 residence and intermediate farms combined.
• 6,700 large farm generate 4.0 times as much NFCI asALL 65,100 residence and intermediate farms combined.
Off-farm income for residence/intermediate farms
Percent off-farm income for farm households …
• 90% for residence farm-HHs. Stable over time.• 75% for intermediate farm-HHs. Growing over time.• 19% for commercial farm-HHs. Declining over time.
Iowa only has 23k“true” farms, in theconventional sense.
$371.586
$342.610
$184.045$231.868
$189.074$179.546
$184.464$206.789
$293.297
$256.618
$170.544
0
10
20
30
40
50
60
70
80
90
100
$0
$50
$100
$150
$200
$250
$300
$350
$400
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Perc
ent O
ff-F
arm
Inco
me
Net
Hou
sehd
ld In
com
e (1
000s
201
3$)
Net Income Per Farm Household by Farm Class in IowaNHHI-Commercial NHHI-Intermediate NHHI-ResidencePct Off-Farm Pct Off-Farm Pct Off-Farm
Off-farm income for residence/intermediate farms
65,100 marginal “farm” operations …• Residence farms only 10% from farming.• Intermediate farms only 25% from farming.
23,000 economically viable farm operations …• Mid-size farms 70% from farming.• Large farms 85% from farming.• Very large suppressed.
$130,196 $71,424$211,956
$592,883
$2,766,051
0
10
20
30
40
50
60
70
80
90
100
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Perc
ent O
ff-F
arm
Inco
me
Net
HH
Inco
me
Net HH Income Per Farm by Farm Class, Iowa 2013
Net HH Inc Pct Off-Farm
<--------------------- Commerical Farms --------------------->
N.A.N.D.
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
Production specialty
Residence & intermediate farms specialize in mixed crops and cattle.
Mid-Sized farms specialize in corn/beans, some livestock.
Large farms also specialize in corn/beans, but also in hogs and cattle.
3042
6168
58
8
7
8
5
41
23
6
17 168
6
13
413 10
18
8 6 6 6 6
0
10
20
30
40
50
60
70
80
90
100
ResidenceFarms
IntermediateFarms
CommericalFarms
Mid-Size Large
Pct F
arm
s
Production Speciality by Farm Class, Iowa 2013
Corn/Soybeans Cash Grains Other CropsCattle Hogs Other Livestock
<----- Commerical Breakouts ----->
Farm debt is low and falling
Farm debt has fallen for all types of farms over the past 10 years.
Commercial farms are most leveraged (~13%), but not near debt max (~30%).
Non-commercial farms are least leveraged (~6%), but near ½ of debt max (~45%).
6.0
4.8
6.0
6.0
8.4
9.4
6.0
9.9
7.2
10.9
13.9
6.3
7.1
6.6
4.6
8.7
8.2
7.0
9.5
10.9
14.9
13.4
13.1
14.5
13.4
15.8
20.0
20.7
17.7
17.4
22.8
23.7
24.0
0
5
10
15
20
25
30
0
5
10
15
20
25
30
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Deb
t as
Perc
ent o
f Far
m A
sset
s
Deb
t as
Perc
ent o
f Far
m E
quity
Debt-Equity & Debt-Asset Ratios by Farm Class in Iowa
Debt v Equity-Residence Debt v Equity-Intermediate Debt v Equity-CommercialDebt v Assets Debt v Assets Debt v Assets
45.5
40.4 44
.8
40.6
52.1
61.1
36.2
56.7
41.7 49
.2
65.0
41.3
45.7
39.7
27.8
44.7
34.6
30.2 36
.1 41.0 48
.2 53.4
28.7
27.6
37.5
29.5
39.6
41.6
26.1
27.8
32.9
31.5
41.3
0
10
20
30
40
50
60
70
80
90
100
0
10
20
30
40
50
60
70
80
90
100
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Perc
ent F
arm
s w
ith D
ebt
Deb
t as
Perc
ent o
f Max
imum
Deb
t Cap
acity
Debt as Percent of Max Debt Capacity by Farm Class in Iowa
Debt Max-Residence Debt Max-Intermediate Debt Max-CommercialPct Farms Pct Farms Pct Farms
Farm debt is low and falling
6 6
13 12
34
11
0
5
10
15
20
25
30
35
40
45
50
0
5
10
15
20
25
30
35
40
45
50
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Deb
t as
Pct o
f Max
Deb
t Cap
acity
Deb
t as
Pct o
f Far
m E
quity
Debt-Equity & Pct Max Debt by Farm Class, Iowa 2013
Debt v Equity Debt Max
<----------------------- Commerical Farms ----------------------->
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
Commercial farm breakouts …
• Mid-size farms most vulnerable – higher debt-equity & higher leveraged.
• Very large farms vulnerable – very high debt-equity, but low leverage.
• Large and non-family farms OK.
Commercial farms youngest; intermediate farms oldestCommercial farmers younger … 19% under 45 yrs & 15% over 65 yrs.
Intermediate farmers older … 9% under 45 yrs & 32% over 65 yrs.
Residence owners are mixed … 15% under 45 yrs & 28% over 65 yrs.
0
5
10
15
20
25
30
35
40
45
50
Residence Intermediate Commercial
Perc
ent F
arm
s
Farms by Age by Farm Class in Iowa
34 & under 35-44 45-54 55-64 65 & over
Commercial farms youngest; intermediate farms oldest
15
9
19
23
34
28
32
17
11
0
5
10
15
20
25
30
35
40
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Perc
ent
Farmers by Age by Farm Class, Iowa 2013
Under 45 65 & over
<----------------------- Commerical Farms ----------------------->
N.D.
N.A.
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
Commercial farm breakouts …
• All commercial farms are younger than residence/intermediate.• Very large and large farms tend to have younger operators.
Commercial & residence farmers best educated
Residence farmers educated due to professional off-farm work.
Commercial farmers educated due to high-resource/SES farms and complexity of modern ag. Similar to residence owners.
Intermediate farmers less educated due to limited-resource/SES farms. Of special concern to ANR programs.
2830
27 27 26
18
2224
22
27
21
13 12 12 11 11
1512
1415
18 17
2724
22 2320 20
25
31
2724
22
0
5
10
15
20
25
30
35
40
45
50
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Perc
ent C
olle
ge D
egre
e
Farmers with a College Degree or Higher in Iowa
Residence Intermediate Commercial
Commercial & residence farmers best educated
28
13
2630
62
29
0
10
20
30
40
50
60
70
ResidenceFarms
IntermediateFarms
Mid-Size Large Very Large Non-Family
Perc
ent
Farmers with a College Degree by Farm Class, Iowa 2013
<----------------------- Commerical Farms ----------------------->
Residence Farm = Under $350,000 GCFI & non-farm occp.Intermediate Farm = Under $350,000 GCFI & farm occp.Mid-Size Farm = $350,000-$999,999 GCFILarge Farm = $1,000,000-$4,999,999 GCFIVery Large Farm = $5,000,000 or more GCFINon-Family Farms = Any farm not operated by owner.
Commercial farm breakouts …
• Mid-size and large farmers just as educated as residence farmers.
• Very large farms tend to be highly educated.
Synopsis – Duality of Iowa Agriculture
Small-Farm Agriculture …
Many farms, but small impact …• 74% of farms, declining numbers over past decade.• Only 33% of farmland, declining acreages (100-250 ac/farm).• Only 20% of production value, but growing.
Poorer farms, but lots of non-farm incomes …• Intermediate – $28,500 NFCI, $71,400 HH income, 75% non-farm.• Residence – $12,500 NFCI, $130,200 HH income, 90% non-farm.• Low debt (6% debt-equity), but ½ of debt capacity.
Mixed crop & cattle specialty farms …• Intermediate – 42% corn/beans, 31% other crops, 16% cattle.• Residence – 42% other crops, 30% corn/beans, 17% cattle.
Majority are full-owners, making sole management decisions.
Synopsis – Duality of Iowa Agriculture
Small-Farm Agriculture …
Intermediate farmers older and less educated …• 13% have college degree (vs 28% for residence).• 80% over age 55 (vs 62% for residence).• Only 9% under age 45 (vs 15% for residence).
ANR programs targeting this group likely to have more participants,
but smaller and less effective impact on agriculture and environment.
Also will require more diverse programming with mixed crops.
Requires parallel programs for …
• Intermediate farms (farm occup, low income, off-farm work, older, less educated)
• Residence farms (non-farm occup, high income, highly educated, other crops).
Synopsis – Duality of Iowa Agriculture
Commercial Agriculture …
Fewer farms, but large impact …• Only 26% of farms, growing numbers.• 66% of farmland, growing acreages.• 80% of production value, growing value.
Mostly larger family farms, fewer mega or corporate farms …• 24% of farms (vs 3% for very-large/non-family).• 700-1,400 ac/farm (vs 300-2,400 ac/farm for non-family/very-large).• 69% of production value (vs 12% for very-large/non-family).
Profitable but polarized …• Mid-Sized – $218,700 NFCI, $212,000 HH income, 30% non-farm.• Large – $735,700 NFCI, $592,900 HH income, 14% non-farm.• Very Large – $3.463mil NFCI, $2.770mil HH income.• Non-Family – $203,200 NFCI.
Synopsis – Duality of Iowa Agriculture
Commercial Agriculture …
Mid-Sized farms are specialized in corn/beans …• 68% corn/beans, 9% other crops. Some hogs.
Large farms are specialized in livestock …• 58% corn/beans, 18% hogs, 13% cattle. Some other grains.
Majority are part-owners, meaning shared management decisions (out-of-state!).
The larger the farm, the younger & educated the farmer …• Under age 45 – 19% mid-size, 23% large, 34% very-large.• College grads – 26% mid-size, 30% large, 62% very-large.
Synopsis – Duality of Iowa Agriculture
Commercial Agriculture …
ANR programs targeting this group likely to have fewer participants,
but larger and more effective impact on agriculture and environment.
Programs can be more targeted and sophisticated because commercial farmers & farms tend to be …
• Younger and college educated.• High-resource, to implement programs on-farm (high NFCI & HH
income).• Farm-focused, farming is primary occup and livelihood.• Conventional commodities consistent with current programs.
Synopsis – Duality of Iowa Agriculture
The Janus-Face of Land Grant Universities …
Commercial-Farm Focus (Hamiltonian Vision) …• Assist those who farm most of the land and produce most of the
commodities.• National benefits (food supply/safety, trade, etc).• Why do wealthy (some very so) & educated farmers need LGU support?
Small-Farm Focus (Jeffersonian Vision) …• Assist those who farm with limited resources (land, income, educ, age,
race).• Farmer/local benefits (higher incomes and QOL for farms and
communities).• Why do non-farmers (hobbyists) need LGU support?
The data support both visions for the LGU.Decisions should be based on tradition, reason, and conscience.
Key Question: How do you define a farmer?
Thank you for joining us todayWe invite your feedback and suggestions for future ANR @ Noon webinars:
John Lawrence – [email protected]
Chris Mondak- [email protected]
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