What Are the Numbers Telling Us?

I have been reading a very interesting report from the USDA’s Economic Research Service, “Farm Size and the Organization of U.S. Crop Farming” by James M. MacDonald, Penni Korb, and Robert A. Hoppe published in August 2013.  What do I think I’ve learned that is useful to beginning farmers (beyond our previous discussion of the factors of beginning farmer success?)

First, there is no doubt that farming consolidation is happening.  Farms are getting bigger.  But, farming is also getting smaller.  There are a number of small farms in the United States, with niche or specialty products.

But here’s what really caught my attention: the return on investment for fruits, vegetables, berries, and nuts.  It is staggering, especially compared with “traditional” crops of corn, hay, soybeans, and wheat.  As the report notes, vegetables and melons; fruits, nuts, and berries; and greenhouse/nursery crops accounted for nearly 37% of all cash receipts from crops in 2007 but less than 4 percent of harvested acreage.

What does that mean in Nebraska, a state where consolidation doubled?  A cynical view of the numbers could mean that the opportunities for entering farming as a profession have decreased.  Or, it could mean there are opportunities for beginning farmers with a little ingenuity, imagination, and a business plan.  What does the beginning farmer need to know?

  • In order to know, research, research, research.  This doesn’t necessarily mean hiding your nose in a book all day, but it does mean knowing the return on investment for commodities you are interested in selling.  It also means knowing whether you can even grow/produce those commodities with the land you have available.  For example, as great as it would be, I don’t think cranberries are going to be successfully grown in western Nebraska.  (I am welcome to be proven wrong, however!)  So, talk to producers who have similar operations.  Take farm tours.  Check out webinars.  Take a class.  Do a small experimental patch for the commodity you are thinking of growing.  Learn how to market your commodity.  In short, keeping learning, because even when you think you know it all, there is something else to learn.
  • Be willing to change tactics and add enterprises.  Okay, so maybe your dream blueberry operation isn’t possible with the resources you currently have possible.  But perhaps a niche operation growing hops is possible.  Or you grow some great fruits and veggies and now, can expand to value-added enterprises such as jams and jellies.
  • Learn from failures.  So that value-added enterprise of making jams and jellies didn’t work out like you anticipated.  That’s okay so long as you learn from it and incorporate that knowledge into your next strategy.
  • Know that you will have to provide labor and physical capital to gain income.  I know of no other way but I’m happy to be proven wrong.

It is possible to become a successful farmer — after all, everyone begins somewhere.  But don’t just begin somewhere randomly.  Have a plan, know the markets, and use all the help you can get.  That help includes this program.  If you have financial or legal questions about beginning a farming operation or just want to discuss ideas, you are welcome to contact us.  After all, it is free of charge — why not take advantage of it?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s