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35-year Study Shows Trend Toward Fewer, Larger Farms

Family Operations Still Greatly Outnumber Corporate Ones, Research Finds

By Samantha Watters


Photo by Edwin Remsberg

While the number of farms is dropping, it’s not a corporate takeover, according to a study by a UMD researcher. He found that while family farms have become larger and fewer, they still dominate U.S. agriculture, with no significant movement of production toward non-family operations.

Thirty-five years of farming data show broad shifts under way, but the trend toward agricultural consolidation may not be quite what you expected, according to a UMD researcher’s analysis.

While the number of farms is indeed dropping—for instance, there were 250,000 dairy farms in 1980 and only about 30,000 today—it’s not a corporate takeover. In fact, while family farms have become larger and fewer, they still dominate U.S. agriculture, with no significant movement of production toward non-family operations. 

That’s one of the findings in a recent publication by James MacDonald, research professor in the Department of Agricultural and Resource Economics, in Applied Economics Perspectives and Policies.

In it, McDonald presents a detailed history of the consolidation of U.S. agriculture based on data from the U.S. Census of Agriculture and surveys from the United States Department of Agriculture Economic Research Service, where he worked for nearly four decades. As chief of the Structure, Technology, and Productivity Branch, MacDonald built a program to analyze consolidation in all sectors of agriculture. His new study draws on data from 1982 through 2017, showing the large aggregate shift in farming operations in unprecedented detail. 

“What’s been happening is a steady shift of acreage and production to larger operations that covers almost all crop and livestock commodities and that occurs steadily over three or four decades,” he said. “A large part of what I was trying to do was capture that story, and then draw conclusions about what that widespread, persistent and large pattern of consolidation meant.” 

Production has significantly shifted to larger farms in 60 of the 62 crop and livestock commodities analyzed over the 35-year period. Smaller farms have increasingly gone out of business, while those with at least 2,000 acres of cultivated land now account for 37% of all cropland, compared to 15% in 1987.

“This shift happens everywhere, in fruits and vegetables as well as field crops,” MacDonald said. “But with crops, we see a more steady evolution, whereas with livestock, you get spurts of dramatic change.”

An example of this can be seen in dairy farming. In 1987, half of all dairy cows in the U.S. were in herds of 80 or fewer cows. But by 2017, that midpoint herd size shifted to 1,300 cows. “Consolidation in dairy is just dramatic,” said MacDonald, “with shifts to much bigger farms and smaller farms going out of business. 

“The last two years, 15% of the dairy farms in the country went out of business. The very large farms have lower costs than midsize and smaller ones, and while those lower costs reflect productivity growth and result in lower prices for the consumer, it is also pretty heartbreaking for … small or midsize dairy farmers who are going out of business.”

According to MacDonald, the widespread and persistent pace of this shift in the data suggests that technology plays an important role in the consolidation process. For instance, new labor-saving equipment, materials, and organizational changes now allow a single farmer or farm family to manage more acres or more livestock. Advances in technology are often expensive to implement, but cheaper in the long run, so larger operations are at an advantage and have lower overall operating costs. 

MacDonald thinks that we may be on the cusp of further technology driven changes through the rise of “precision agriculture” technologies in farming, which allow farmers to collect, analyze and apply finely detailed information from field and herd operations. Some precision agriculture applications may favor smaller operations, but others could provide advantages to very large farming organizations.



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