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USDA Report Details Million Dollar Farms

posted on January 9, 2009


Senate Agriculture Committee Chairman Tom Harkin of Iowa predicts Ag Secretary-nominee Tom Vilsack will sail through a confirmation hearing next week.

Vilsack, a political veteran who served two terms as Iowa's governor before launching a unsuccessful bid for the presidency, has been praised by U.S. Senators from both sides of the aisle.

If confirmed, Vilsack would assume the helm of the U.S. Department of Agriculture, a massive agency with more than 105,000 employees and a budget which exceeds $95 billion.

Vilsack's appointment has drawn criticism from the Organic Consumers Association which claims the nominee has repeatedly demonstrated a preference for large industrial farms and genetically modified crops.

Perceived preferences aside, USDA recently reported on the growth of so-called "million dollar" farms.

USDA Report Details Million Dollar Farms

A new report from the U.S. Department of Agriculture reveals small farms make up a large majority of U.S. ag operations but account for a much smaller percentage of farm production – especially compared to million-dollar operations.

USDA classified small farms as those with annual sales less than $250,000. These so-called small farms represent 92 percent of U.S. farms but account only 23 percent of total production. According to USDA, farm operations grossing more than one million dollars annually represent only 2 percent of all U.S. farms but account for nearly 50% of the entire domestic agricultural production.

The report also made a series of conclusions…

The shift in production to million dollar farms is likely to continue due to the competitive advantage brought on by farm economies of scale.

A single million dollar farm does not have market power. USDA found it was unlikely single operations could dominate specific agricultural commodities.

Most million-dollar farms are family operations. The Agriculture Department discovered that 84 percent of million dollar farms were owned by the operator and related individuals.

According to USDA analysis, million dollar farms doubled their market share from 23 percent in 1982 to nearly 50 percent in 2002. USDA says so-called mega farms are a mix of recent entries to agriculture and long-time operators dating as far back as far as 1978.

 


Tags: agriculture crops farms markets news USDA