Crop Production
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 964,770 crop farms in the US produce more than 382 million acres of commercial-scale grains, sugar, fruits, nuts, vegetables, and ornamental crops. The establishments that produce these are generally considered farms but, depending on the commodity produced, may be more specifically known as orchards, groves, greenhouses, and nurseries. About 25% of crops are grown as seed or as input for other crops or livestock.
Aging Farmer Population
The average age of a US farmer in 2022 was 58.
Contract Farming Declining
The process by which a buyer, typically a food processor or supermarket chain, establishes an agreement with a farm to produce a certain quantity and quality of a given crop in exchange for an agreed-upon price and a given delivery date, known as contract farming, is on the decline in the United States.
Industry size & Structure
The average crop farm has two employees and generates about $291,000 in annual revenue.
- The US Census Bureau defines a farm as an operation that produces or should have reasonably produced over $1,000 in revenue during a given year, including government payments. Under this definition, there are about 964,770 crop farms in the US.
- Crop farms produce about $280 billion in value annually, with corn and soybeans accounting for more than half of US crop cash receipts.
- Family-owned and operated farms account for 95% of all US farms and 84% of farmland.
- Over 2.5 million are employed in the crop sector and over 45% of employees are family members.
- Small family farms (less than $250,000 in annual sales) make up 88% of US farms and hold 51% of all farm assets.
- Large farms (more than $1 million in annual sales) account for 78% of the production value.
- Over 17,000 crop farms are certified as organic, for a total of 4.9 million certified organic acres. These farmers sell about $6.1 billion in organic crops annually. Marketing of organic products is primarily to food wholesalers (60%) and consumers (30%); the remainder is to food retailers.
- 35% of US farms fully own their land; 31% is rented to farmers who also own their land, and 9% is rented to tenant farmers who don’t own land.
- Nearly 80% of farms in the US have Internet access.
Industry Forecast
Crop Production Industry Growth
Recent Developments
Dec 23, 2024 - Farm Recession
- Falling crop prices and rising input costs are causing US farmers to cut back on spending, sending shocks throughout the US agriculture sector and leading The Wall Street Journal to announce in a December headline “America’s Farm Recession is Here.” The downturn in the ag economy, which began in 2023 when net farm income tumbled 20% and again by about 4% in 2024, follows record setting farm income in 2022 fueled by soaring grain prices due to the pandemic and war in Ukraine, according to the USDA. Rising costs for seed, fertilizer, and equipment amid tumbling prices for corn, soybeans, and wheat due to bumper crops is weighing on farmers’ earnings, WSJ reports. Some farmers are counting on a multibillion-dollar federal bailout attached to the continuing resolution signed by President Biden in December that contains a $10 billion provision for economic assistance to farmers.
- The specter of mass deportations of undocumented immigrants and further restrictions on immigration under a second Trump administration has farmers worried, CNN reports. Mass deportations of undocumented immigrants would likely slash farm labor in half, which could result in massive food waste and create risk for the nation’s food security, Ron Estrada, CEO at Farmworker Justice, told CNN. Moreover, there’s little appetite among native-born workers to work the fields. Farmers in the US, especially in specialty crop and livestock operations, are already struggling to find enough workers. As of the 2022 Census of Agriculture, 15% fewer farms reported using hired labor compared to 2017. As of 2021, an estimated 47% of all US agricultural workers were of Hispanic (including Mexican) origin, and 39% were not born in the US (including Puerto Rico), with many lacking authorization to work legally in the United States.
- US corn and soybean farmers could lose billions of dollars in annual production value should a new tariff-induced US-China trade war occur, according to a new study commissioned by the American Soybean and the National Corn Growers associations conducted by the World Agricultural Economic and Environmental Services. The study states “US soybean farmers (could) lose an average of $3.6 to $5.9 billion in annual production value” while “US corn farmers (could) lose an average of $0.9 to $1.4 billion in annual production value” depending on how China responds to increased US tariffs. A new trade war could cause US crop prices to fall, dramatically reduce US exports to China, and benefit growers in Brazil and Argentina, according to the study. President-elect Trump has proposed tariffs as high as 20% on all imported goods, which, if enacted, could trigger a trade war.
- Hurricanes are taking a heavy toll on US crop production, with preliminary estimates for the economic impact of Hurricane Helene to Georgia agriculture alone topping $6 billion, according to the University of Georgia College of Agricultural and Environmental Sciences. State officials said the heaviest storm-related losses were in timber, pecans, and horticulture. It's estimated that 420,000 pecan trees were lost to the storm. Cotton also took a hit with Helene destroying one-fifth of the state’s crop, according to the USDA’s monthly Crop Production report. The department estimated that growers would harvest 1.65 million bales of cotton, down by 400,000 bales from a pre-hurricane estimate. North Carolina’s cotton crop was estimated at 700,000 bales, down 7% due to the hurricane. “Georgia and North Carolina accounted for much of the reduction as high winds and heavy rain pummeled open bolls,” according to a USDA report.
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