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Farm Definition; What’s it Mean and Why is it Important?
Michael DuffyIowa State University
AAEA Annual MeetingsOrlando, FL
2008
Farm Definition
• For Census of Agriculture;“a farm is any place from which
$1,000 or more of agricultural products were produced and sold, or normally would have been sold, during the census year.”
• This definition was first used for the 1974 Census
2002 Census
• The 2002 Census continued this definition but there was expanded coverage
• The goal of the expanded coverage was to capture the underreported farms, especially small farms.
• NASS was very successful in meeting their goal
Percent Change in 1997 Estimates by Sales Class
0%
10%
20%
30%
40%
50%
60%
>$1,
000
$1 to
$2,
499
$25t
o $4
,999
$5 to
$9,
999
10 to
$20
,000
20 to
$25
,000
25 to
$39
,999
40 to
$49
,999
50 to
$99
,999
100
to $
249,
999
250
to $
499,
999
500
to $
999,
999
> $1
M
Background
Percent US Farms and Sales by Sales Class 2002
0%
10%
20%
30%
40%
50%
>$1K
1 to
$2,
499
$2.5
to $
4,99
9
$5 to
$9,
999
10 to
$19
,999
20 to
$24
,999
25 to
$39
,999
40 to
$ 4
9,99
9
50 to
$99
,999
100
to $
249,
999
250
to $
499,
999
500
to $
999,
999
> $1M
Farms Sales
Percent Change in US Farms and Sales by Sales Class, 1997 to 2002
-20%
-10%
0%
10%
20%
30%
40%
>$1K
1 to
$2,
499
$2.5
to $
4,99
9
$5 to
$9,
999
10 to
$19
,999
20 to
$24
,999
25 to
$39
,999
49 to
$ 4
9,99
9
50 to
$99
,999
100
to $
249,
999
250
to $
499,
999
500
to $
999,
999
> $1M
Farms Sales
The Smallest Farms
Percent of Operators in Each Age Group
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
Under 25 25-34 35-44 45-49 50-54 55-59 60-64 65-69 Over 70
All Farms >$1,000
Years Operator has been on Current Farm
0%
10%
20%
30%
40%
50%
60%
70%
80%
2 years or less 3 or 4 years 5 to 9 years 10 years or more
All Farms Under $1000
Farms in Programs or Receiving Payments for All Farms and those with Sales Under $1000
0%
10%
20%
30%
40%
50%
60%
Government Payments CRP WRP Federal or Crop Insurance Programs
All Farms >$1K
Percent of Operators Working Off Farm
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
None 1 to 49 days 50 to 99 days 100 to 199 days 200 days or more
All Farms >$1,000
Gender of Principal Operator
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Male Female
All Farms Under $1000
Tenure of All Farms and those Under $1000 in Sales
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Full owners Part owners Tenants
All Farms Under $1000
Percent of Operators in Sales Class by Primary Occupation
0%
10%
20%
30%
40%
50%
60%
70%
Farming Other
All Farms <$1000
Percent of Operators total Household Income from Farming
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
<25% 25-49% 50-74% 75-99% 100%
All Farms <$1000
Operators Under $1,000 as a Percent of Total Operators, 2002
0%
5%
10%
15%
20%
25%
30%
35%
Male Female
Changes in Female Farm Operators as a Percent of Total Operators
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
1992 1997 2002
% Female $1K as % of Females
Percent of Farms with Sales Under $1000 in the State
W Y
W V
W I
W A
VT
VA
U T
TX
TN
SD
SC
R I
PA
O R
O K
O H
N Y
N V
N M
N J
N H
N E
N D
N C
M T
M S
M O
M N
M I
M E
M D
M A
LA
KYKS
INIL
ID
IA
H I
G A
FL
D E
C T
C OC A
AZAR
AL
AK
21.9%
37.6%
31.3%
29.0%
25.9%
24.0%
36.8%
28.2%
28.4%
18.2%
43.8%
24.1%
30.4%
27.6%
24.1%
24.3%
26.4%
25.4%
36.4%
29.5%
37.2%
16.2%
28.2%
25.1%
28.6%
39.0%
22.1%
29.4%
32.7%
37.0%
29.8%
28.4%
29.0%
21.3%25.6%
25.7%22.7%
33.4%
21.7%
12.2%
34.7%
27.3%
13.6%
31.3%
30.1%20.8%
34.8%20.5%
29.5%
20.9%
12% - 24%
24% - 30%
30% - 35%
35% - 44%
So Why Worry?
• “The census of agriculture is the leading source of facts and statistics about the Nation’s agriculture”
• The data is used by a variety of sources and for a variety of purposes, including:– “…formulate farm and rural policies..”– “Allocate local and national funds for
farm programs…”
So Why Worry?• It causes misinformation to be
disseminated regarding the sector, the information is there but people won’t take the time to verify ‘facts’
• It masks the changes that are occurring, such as consolidation and it provides an erroneous message with respect to the entry of women and minorities in ag.
So Why Worry?• Current method provides a distorted view
of the production ag. sector.– Over past decade net farm income was 20% of
gross farm income. If averages hold and using
gross for sales this would mean the small class had less than $200 in net farm income
- In 2002 only 47% of the farms with sales less than $1,000 said they intended to do so. 39% did not and 15% didn’t answer.
- With point farms, the total number of farms decreased 3%, without them there was a 13% decrease
Solutions
• Dual census• Increase the cutoff based on
inflation since 1974• Change approach entirely• Leave it as it is