Nature of American Farms
Farms and the concept of a family farm remain prominent symbols of our American heritage despite the long steady decline in the number of farms in the U.S. and in Kentucky. Nationally the number of farms peaked in the 1930's at 7 million. Today there are 2.1 million farms in the U.S. according to the latest Census of Agriculture. Kentucky is listed as having a little over 86,000 farms. The major decline in farm numbers occurred in the 1930's through the 1960's. But the decline has moderated during the past several decades. Most farms are considered "small" in that annual gross sales are less than $100,000. In Kentucky approximately 90% of our farms fall into this "small" category.
This large decline in farm numbers has been offset by an increase in farm size, measured by acreage. The average U.S. farm is 441 acres while the average farm size in Kentucky is now 160 acres. But these statistics do not tell the entire story about how different size farms have fared over the past decades. For example, farms with fewer than 50 acres of production and farms with more than 500 acres have both increased their share of total numbers of farms while those in the middle-so called mid-size farms have declined. But another significant reason for production increases (in the face of declining farm numbers) is reflected in the tremendous gains in agricultural productivity. Farmers today can simply produce so much more than their predecessors could. This is true whether one considers an acre of land or the rate of gain in livestock.
The economic reality today for many "small" farms is the importance of off-farm income. It is very common today for farm household adults to work off farm (often full-time) while "farming on the side." National data suggests that small farms lose money most years from farming when you consider all the economic costs, but that these losses are more than off-set by off-farm income. And, of course, off-farm jobs often provide those important fringe benefits of retirement packages and medical insurance.
Although most farms (in terms of numbers) are considered small, they only produce a very small percent of the food and fiber in the U.S. (about 15%). In contrast, the largest farms produce more than 85%. So a dilemma faced by policy makers as they consider future farm policy is what should be the appropriate role of federal programs given these major changes in the nature of farming.
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For additional information, please contact, Larry Jones.