Commodity Payments, Farm Business Survival, and Farm Size Growth


Book Description

In the last 25 years, U.S. crop farms have steadily declined in number and grown in average size, as production has shifted to larger operations. Larger farms tend to receive more commodity program payments because most payments are tied to a farm's current or historical production, but whether payments have contributed to farm growth is uncertain. This study uses farm-level data from the census of agriculture to determine whether there is a statistical relationship between farm commodity program payments and greater concentration in production. The analysis indicates that, at the regional level, higher commodity program payments per acre are associated with subsequent farm growth. Also, higher payments per acre are associated with higher rates of farm survival and growth.




Farm Payment Programs


Book Description

From 2006 through 2010, the U.S. Department of Agriculture (USDA) spent about $13 billion annually on federal programs to support farm income, assist farmers after disasters, and conserve natural resources. Through one facet of this farm safety net, USDA provides farmers and other producers with fixed annual payments, called direct payments, based on their farms' historical crop production. USDA makes these payments regardless of whether these producers grow crops, as long as they and their farms meet certain eligibility criteria. Amounting to nearly $5 billion annually since 2002, direct payments do not vary with crop prices, crop yields, or producers' incomes. This book examines current farm payment programs and reduction proposals, with a focus on the direct payments program, the future of environmental compliance incentives in U.S. agriculture, and changing farm structure and the distribution of farm payments and federal crop insurance.







Farm Payments


Book Description




The Changing Scale of American Agriculture


Book Description

Few Americans know much about contemporary farming, which has evolved dramatically over the past few decades. In The Changing Scale of American Agriculture, the award-winning geographer and landscape historian John Fraser Hart describes the transformation of farming from the mid-twentieth century, when small family farms were still viable, to the present, when a farm must sell at least $250,000 of farm products each year to provide an acceptable level of living for a family. The increased scale of agriculture has outmoded the Jeffersonian ideal of small, self-sufficient farms. In the past farmers kept a variety of livestock and grew several crops, but modern family farms have become highly specialized in producing a single type of livestock or one or two crops. As farms have become larger and more specialized, their number has declined. Hart contends that modern family farms need to become integrated into tightly orchestrated food-supply chains in order to thrive, and these complex new organizations of large-scale production require managerial skills of the highest order. According to Hart, this trend is not only inevitable, but it is beneficial, because it produces the food American consumers want to buy at prices they can afford. Although Hart provides the statistics and clear analysis such a study requires, his book focuses on interviews with farmers: those who have shifted from mixed crop-and-livestock farming to cash-grain farming in the Midwest agricultural heartland; beef, dairy, chicken, egg, turkey, and hog producers around the periphery of the heartland; and specialty crop producers on the East and West Coasts. These invaluable case studies bring the reader into direct personal contact with the entrepreneurs who are changing American agriculture. Hart believes that modern large-scale farmers have been criticized unfairly, and The Changing Scale of American Agriculture, the result of decades of research, is his attempt to tell their side of the story.




Farm Programs


Book Description

" Through one facet of the farm safety net, USDA provides farmers and other producers with fixed annual payments, called direct payments, based on their farms' historical crop production. Direct payments do not vary with crop prices or crop yields. In March 2011, GAO reported on observations and options regarding direct payments and suggested to Congress that they be eliminated or reduced. GAO was asked (1) to provide information regarding the geographic distribution and ownership characteristics of payment recipients, as well as the dollar amount of direct payments made for farms with acreage that qualified, and the amount and types of crops grown on such acreage for years 2003 to 2011, and (2) to examine whether direct payments are aligned with principles significant to integrity, effectiveness, and efficiency in farm bill programs. To conduct this work, GAO analyzed USDA data and interviewed agency officials. "




The Effects of Federal Farm Support Programs on Farm Consolidation and Rural Economy


Book Description

This study analyses the effects of US farm payments on the structure of agriculture and economic growth in farm-dependent non-metro counties between 1992 and 2002. In particular, I attempt to analyze how decoupling some government payments from farm production levels has affected farm structure and incomes in non-metro ag-dependent counties. My data were mostly obtained from the 1987, 1992, 1997 and 2002 Censuses of Agriculture and the 1990 and 2000 Censuses of Population and Housing. I used household income distribution data to calculate Gini coefficients indexing income inequality for all US counties. I also used farm (acreage) size distributions to calculate Gini coefficients indexing farm size inequalities by county. I use these data to test my hypotheses about the effects of per-farm government payments on rates of farm consolidation and farm loss, and on county-wide median incomes and income equality, via weighted least-squares linear regression models. My empirical results indicate some perverse effects of farm payments on rates of farm consolidation and farm size inequalities in rural ag-dependent counties, even after the implementation of decoupling in the 1996 Farm Bill. The effects of government payments on rates of farm survival are shown to be trivial. In conclusion, the effects of federal farm payments on ag-dependent economies are mixed at best. They are not efficient drivers of economic growth in these counties.