From 2017 to 2022 the number of farms in the United States declined by 141,733 or 7 percent, according to the U.S. Department of Agriculture’s 2022 Census of Agriculture released Feb. 13. Acres operated by farm operations during the same timeframe declined by 20.1 million, a loss equivalent to an area about the size of Maine. Only 1.88 percent of acres operated and 1 percent of farm operations were classified under a non-family-corporate farm structure.
Conducted every five years, the Census of Agriculture collects data regarding land use and ownership, producer characteristics, production practices, income and expenditures. The USDA defines a farm as an operation that produced and sold, or normally would have sold, $1,000 or more of agricultural products during the census year.
While the number of farm operations and acres operated declined, the value of agricultural production increased – from $389 billion in 2017 to $533 billion in 2022. Those updated numbers highlight the continuing trend of fewer operations farming fewer acres of land but producing more each year.
In addition to Ag Census data, the USDA releases survey-based estimates regarding farm numbers once every year. Using the annual survey data dating back to 1950, the trend of fewer operations farming fewer acres becomes even more obvious. Since 1950 the number of farm operations has declined by 3.75 million or 66 percent – and the number of acres farmed declined by 323 million or 27 percent. That’s slightly less than twice the size of Texas.
Technological advancements that have increased productivity, such as feed-conversion ratios in livestock and yield per acre in crops, have allowed farmers and ranchers to produce more with less even as the U.S. population more than doubled – going from 159 million in 1950 to 340 million in 2023. The global population has more than tripled from 2.5 billion to 8 billion during the same period.
Farm operations detailed
From 2017 to 2022 all states but five – Alaska, Iowa, Maryland, New Jersey and Rhode Island – lost farms.
• Texas had the largest numerical loss – almost 18,000 farm operations – followed by Oklahoma at a loss of 8,153 and Missouri at a loss of 7,433.
• Iowa gained the most farm operations at 807 followed distantly by Alaska at 183.
• In terms of percentage loss of farm operations, New Mexico experienced the largest decline at 16.2 percent followed by Arizona with a loss of 12.5 percent and Wyoming with a loss of 11.7 percent.
• Alaska’s 183-farm gain was the largest percent increase at 18.5 percent.
Though the presence of regional trends in farm-operation losses appears limited, drought conditions that battered much of the West in 2021 and 2022 may be responsible, in part, for greater farm-loss percentages in those states. Across states that gained farms, most were within the category of earning more than $1 million in sales – except in Alaska where the biggest gains were in farms earning between $5,000 and $50,000.
Area operated detailed
The 2022 census indicates a decline of about 20 million acres in acreage operated.
• Colorado led in terms of numerical decline, with 1.6 million fewer acres being farmed in 2022 compared to 2017, followed by Texas with a loss of 1.56 million and Oklahoma with a loss of 1.26 million.
• Only three states – Alabama, Alaska and Rhode Island – had increases in operated area.
• By percent decline, the map of operated acreage looks quite different. Hawaii leads with a loss of 7.2 percent of operated area followed by Virginia and Maine – both experiencing a loss of 6.3 percent – and Washington experiencing a loss of 5.6 percent.
• Counties in the West had the largest swings in acreage operated, likely linked to the sheer size of counties with a significant proportion of open and undeveloped land.
Even minor declines in farmed area can have a significant impact on the rural identity of states with smaller acreage, and greater rates of commercial and residential development. The more land shifts out of agricultural production, the more difficult it is to return those acres to farming. Diminished production capacity within specific states and regions heightens dependence on purchases from other states or countries.
• Hawaii faces a unique situation with only enough production and food-storage capacity to sustain itself for seven days, exacerbated by a 7 percent loss in actively farmed land during the past five years.
• In New England, on a weight basis, farmers produce only about 21 percent as much food as the states consume – with a portion of that going to outside buyers. Researchers have estimated that in order to reach 30 percent self-food-sufficiency, the six New England states would need to maximize the use of 401,000 existing underutilized acres and clear an additional 588,000 acres of land. Instead, acres operated in New England decreased by 145,000 from 2017 to 2022.
Local regulatory dynamics, land-use pressures and costs, and variations in cultural interests contribute to the shifting landscape of farming, often pushing it farther away from population centers.
Economic class changes
New Ag Census data allows analyses of farm numbers and area operated by economic class, and the market value of agricultural products sold.
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• Economic sales classes are defined by summing the sales of agricultural products and government-program payments.
• Market value of agricultural products sold represents the gross market value before taxes and production expenses of all agricultural products sold or removed from an operation in 2022.
From 2017 to 2022 the number of farms in the $0-$4,999 economic class decreased the most, by 120,970, followed by the $5,000-$49,000 category, which lost 32,215 operations. The category of farms in an economic class of more than $1 million grew by 28,566 operations. The number of farms in lesser economic classes shrank at a faster rate than those in greater economic classes. That said, most ag production is generated by farms in greater economic classes. In 2017, 69 percent of the value of agricultural products sold was products by farms in the million-dollar-plus economic class. In 2022 that increased to 79 percent.
Farmers and ranchers currently face the biggest production expenses on record. They also face increasingly complex local, state and federal regulations as well as growing competition from reduced-cost foreign markets. Those dynamics shrink margins for producers and often more-significantly impact farms in lesser economic classes.
Farms that are able often expand in size to capitalize on economies of scale, a concept rooted in the efficiency often gained as production increases. Larger farms can benefit from reduced per-unit costs due to bulk input purchasing, streamlined operations and enhanced bargaining power with suppliers. Mechanization and modern technology – which often come with substantial upfront costs – are more economically justifiable for larger operations, further boosting productivity.
Unsurprisingly, the latest census data underscores that farms making those investments tend to fare better. Notably, farms in the $0-$4,999 and $5,000-$49,999 economic classes, constituting more than 70 percent of total farms, often rely on alternative income sources. Those in the $0-$4,999 economic class, especially, are more likely to be operations participating in agriculture for leisure or personal interest as opposed to income reliance. Declines in operations in those categories may be linked to the cost associated with supporting a side business – a business that may no longer be sustainable but has limited impacts on total domestic food production.
Farm typology reported
The USDA reports the number of farms and acres operated by farm type. That section of the report captures the different ownership structures of farming operations.
• family-held corporations
• family and individual filings
• partnerships
• corporations, excluding family held
• “other” that includes institutional, research, reservations and other-owner entities
Family and individual filings, partnerships and family-held corporations represented 97 percent of all farms in 2022 – a decrease from 97.2 percent in 2017. Corporations other than family-held comprised 1 percent of all farms and the “other” category comprised the remaining 2.2 percent of farms.
Analyzing in terms of acreage managed by those operation types in 2022 provides a better understanding of the proportion of agricultural production in the category.
• Family and individual filings, partnerships and family-held corporations represented 91 percent (801 million) of all acres operated in the United States.
• Family and individual filings represented 58 percent of operated acreage alone – a slight decrease from 60 percent in 2017.
• Non-family-held corporations represented 2 percent of acreage operated – and increase from 1.4 percent in 2017.
• “Other” entities operated 7.1 percent of acres in 2022, much of which was concentrated in Western states with substantial land in American Indian reservations.
The overwhelming majority of farmland in the United States continues to be operated by family-based ownership structures. By state, Hawaii had the greatest percentage of acres operated by non-family-held corporations, followed by Rhode Island and Florida. In Alaska and New Hampshire no farm acreage was managed by non-family-held corporations.
Conclusion
The 2022 Census of Agriculture provides an in-depth look at the U.S. farm landscape across the past five years. With a loss of 141,733 farm operations, representing a 7 percent decline, and reduction of 20.1 million acres under cultivation, equivalent to the size of Maine, the agricultural sector has faced significant shifts. Though the data shows an ongoing consolidation of farms into fewer and larger operations, it also highlights the adaptability of farmers and ranchers. Despite fewer farms and reduced acreage, the value of agricultural production has increased by 40 percent, reaching $543 billion in 2022. That increase in productivity underscores the impact of technological advancements and efficiency gains, allowing farmers to produce more with fewer resources.
The magnitude of changes is not uniform across states, with the Southwest experiencing a much greater percentage loss in farms than states east of the Mississippi. The challenges faced by farms of all sizes has raised calls for a robust and comprehensive farm bill that could provide support to the operations most at risk and to those providing the lion’s share of the American food supply. That would help to navigate economic uncertainties and regulatory complexities, to undertake innovative and sustainable practices, and to promote the long-term viability of a diverse agricultural landscape across the nation. The Census of Agriculture paints the picture of what we have lost, and of what more could be lost without firm support.
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Daniel Munch is an associate economist with the American Farm Bureau Federation’s Market Intel. Visit www.fb.org/market-intel for more information.