USDA releases America’s Farms and Ranches at a Glance report

On Dec. 12, the U.S. Department of Agriculture (USDA) released the 2023 America’s Farms and Ranches at a Glance report during a webinar hosted by Katherine Lacy, research agricultural economist in the Farm Economy Branch of the Rural Economic Division at USDA’s Economic Research Service (ERS).

Lacy’s research background has focused on the changing distribution of farm and ranch sizes, the resilience of local food systems and the impacts of health and tax policies on rural communities.

This year’s edition of America’s Farm and Ranches at a Glance report describes the characteristics of nearly two million U.S. farms in 2022. Specifically, it examines what farms produce, how much they profit and their participation in federal agricultural programs. 

The two-part report, co-authored by Christine Whitt and Katherine Lim, research agricultural economists in the Farm Economy Branch of the Rural Economic Division at USDA’s ERS, also provides information on household well-being for farm families.

Data for the 2023 report comes from the 2022 Agricultural Resource Management Survey (ARMS), a unique annual survey of farm and ranch operations conducted by ERS and the National Agricultural Statistics Service.

U.S. farm statistics

A farm classification system, “farm typology,” was updated in 2013 by ERS and was utilized to gather and analyze data from the research study. 

“The ERS categorizes farms into groups with some common characteristics, and the classifications were based on each farm’s annual revenue, the main occupation of the farm’s principal operator and ownership,” Lacy addresses.

The term “family farm” has a broad definition, and farm typology has been developed, defining a farm as any place which sold or would have sold at least $1,000 worth of farm products in a given year. 

“Most of the analysis in our report is based on a total sample of approximately 19,100 farms from the 2022 ARMS,” she notes. “In total, family farms accounted for about 97 percent of total farms and 90 percent of total production in 2022, while nonfamily farms accounted for the remaining three percent.”

To further detail U.S. farms, ERS has identified four different categories – small family farms, midsize family farms, large-scale family farms and nonfamily farms.

“We had to condense farm typology for this project, so we broke down small family farms into four different typology groups – retirement, off-farm, low sales and moderate sales. Eighty-eight percent of U.S. farms are considered small family farms, but these farms only account for 46 percent of agricultural land operated,” Lacy explains.  

According to the USDA report, between 52 and 79 percent of small family farm typologies had an operating profit margin in the high-risk zone in 2022 but had lower average loan amounts relative to all other farm sizes.

Lacy adds, “Operators of small family farms, especially off-farm-occupation and low-sales farms, often reported losses from farming. In 2022, the average farm income among off-farm-occupation farms was $2,943 and among low-sales farms, it was -$2,976.”

Additional research

Additionally, USDA research shows 847.4 million acres were in operation, and the total value of production was $449.6 billion for 2022.

“Large-scale family farms accounted for 52 percent of the total value of production, and 25 percent of agricultural land in 2022,” Lacy continues. “Midsize family farms accounted for 21 percent of agricultural land and 19 percent of the total value of production.”

The teams research denoted among nonfamily farms, 16 percent had a gross cash farm income of $1 million or more. These large-scale nonfamily farms accounted for 89 percent of all nonfamily farms’ production.

USDA reports the value of production can be divided into selected commodities where large-scale family farms dominate the production of beef, hogs, cash grains and soybeans, cotton, dairy and specialty crops. 

In the remaining two commodities, poultry and eggs and hay, small family farms and midsize family farms dominate production, and nonfamily farms were reported as less than 20 percent for all commodities.

However, in 2022, small family farms produced 45 percent of the total value of U.S. poultry and egg output and 26 percent of the value of beef production. 

“If you compare this report to last year’s edition, the value of hog production and specialty crop production increased for large-scale family farms and decreased for nonfamily farms,” Lacy remarks.

Government payments and federal crop insurance

“Distribution of direct government payments varied by farm and program type in 2022 and overall, 25 percent of all farms report receiving some type of government payment, a decline from 34 percent in 2021 and 40 percent in 2020,” Lacy points out. 

“Small family farms received 78 percent of all payments from USDA’s Conservation Reserve Program, and 62 percent of all USDA Natural Resources Conservation Service working-land program payments were received by midsize family farms, large-scale family farms and nonfamily farms,” she continues.

She adds, “The distribution of government payments across farm type could be driven by differences in the underlying commodities produced by different farm types.” 

The report denotes small family farms tend to account for a larger percentage of poultry and egg and hay production, and these producers are not eligible to receive countercyclical-type payments. 

Whereas midsize and large-scale family farms account for most of the value of production of cash grains, soybeans and cotton, commodities targeted by countercyclical-type programs.

“Overall, 13 percent of U.S. farms participated in federal crop insurance programs, but participation rates varied widely across commodity production,” she concludes. “Although midsize and large-scale family farms made up nine percent of all U.S. farms in 2022, these farms accounted for 42 percent of federal crop insurance participants, 67 percent of all harvested cropland acres and received 80 percent of indemnities from federal crop insurance.”

The 2022 ARMS sample weights were calibrated using targets from the 2017 Census of Agriculture. Therefore, the statistics summarized in the report are subject to revision after the publication of the 2022 Census of Agriculture data.

Melissa Anderson is the editor of the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.