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 2017 was 57.

Contract Farming Declines

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
Industry Forecast
Crop Production Industry Growth
Source: Vertical IQ and Inforum

Recent Developments

Apr 23, 2024 - Producer Prices Are Falling
  • The Producer Price Index for commodity farm products, which measures prices before reaching consumers, fell 7.3% in March compared to a year ago after declining 3.5% in the previous annual comparison, according to the latest US Bureau of Labor Statistics data. US farm incomes are forecast to fall sharply in 2024 for a second consecutive year as growing supplies of grains and oilseeds send crop prices plunging to multi-year lows, the USDA said in February.
  • Heat waves are lingering for longer periods, exacerbating the harmful effects of extreme temperatures, The New York Times reports, citing a study published in March in the journal Science Advances. Fueled by global warming, heat waves have increased in frequency, intensity, and duration across many parts of the globe during the past decades, according to the study, with serious consequences for crop and animal production. Between 1979 and 2020, the rate at which heat waves travel slowed by about 5 miles per day, the study found. Heat waves also now last about four days longer on average. Life-threatening heat waves dry out soil and vegetation, harm crops, and raise the risk of wildfires. Among the first to track how heat waves move through space and time, the study attributes the changes largely to human-caused climate change and natural climate variability.
  • The newly-released 2022 Census of Agriculture (COA) finds the number of farms and ranches in the US fell to 1.9 million (down 7% from 2017), extending its downward slide, according to the USDA’s National Agricultural Statistics Service. US farms and ranches produced $543 billion in agricultural products in 2022, up from $389 billion in 2017. With farm production expenses of $424 billion, US farms had net cash income of $152 billion while average farm income rose to $79,790, per the COA. A total of 43% of farms had positive net cash farm income in 2022. Family-owned and operated farms accounted for 95% of all US farms. The COA also shows that farms with internet access continued to rise from 75% in 2017 to 79% in 2022. The average age of all producers was 58.1, up 0.6 years from 2017, a smaller increase than between prior censuses.
  • Organic farmers are seeing changes to the certification process and the organic supply chain under new regulations from the Department of Agriculture, the Organic Trade Association reports. Under the final Strengthening Organic Enforcement rule, organic farmers must also do their part to deter and detect fraud in the supply chain, according to the OTA. All organic operations, including farmers, must have a fraud prevention plan in their Organic System Plan (OSP). Records must be maintained and kept that verify the organic status throughout the growing season, the life of the animal, or any movement of crops or animals (off-farm storage or custom heifer pasturing, for example). The strengthening of the certification process follows a few high-profile cases of fraudulent organic sales; the new regulation closes many loopholes and seeks to enhance the quality of organic audits and oversight. The deadline for full compliance was March 2024.
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