Farm Support Services
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 9,660 companies in the farm support services sector provide a variety of services for either crop or animal production. Services include farm management services, farm labor contracting, pest control, packaging of crops, breeding, and sheep dipping and shearing, among many others.
Dependence On Ag Production and Farm Income
Farm support services companies are subject to supply and demand fluctuations in animal and crop production.
Impact of Immigration Reform
Many farm services companies employ migrant workers, particularly farm management services and farm labor contractors.
Industry size & Structure
The average farm support service provider employs about 9-10 workers and generates $2-3 million in annual revenue.
- The farm support services industry includes about 9,660 companies that employ some 94,850 workers and generate around $24.6 billion in annual revenue.
- Farm support services companies vary widely in the type of services provided and processes used.
- Large firms include Archer Daniels Midland, Cargill, and Syngenta.
- California, Texas, and Florida are home to most farm support service providers.
Industry Forecast
Farm Support Services Industry Growth
Recent Developments
Sep 30, 2024 - Mass Deportations Would Threaten Farm Labor
- Former President Donald Trump’s mass deportation plan, if enacted, could cut the agricultural labor force in half and create major obstacles for US farmers already struggling with labor shortages, experts cited by Newsweek warned. Nearly half (45%) of all agricultural workers in the US – 950,000 of an estimated 2.2 million farmworkers – are "unauthorized" migrants working illegally on US farms and ranches. The dairy industry would be especially hard hit. According to the National Milk Producers Federation, immigrant labor accounts for 51% of all dairy labor, and dairies that employ immigrants produce 79% of the US milk supply. Major dairy-producing states, including California and Wisconsin, would be significantly impacted by the proposed deportations, as would fruit and vegetable producers in California, where approximately 75% of farm workers are undocumented, according to the Center for Farmworker Families.
- Updated projections for 2024 farm income don’t look quite as gloomy as they did earlier in the year, AgWeb’s Farm Journal reports, citing new data from the Economic Research Service. The new ERS numbers show that net cash farm income for 2024 will fall by about $12 billion, down about 7% from 2023, and net farm income will fall by $6.5 billion or 4.4%. That’s compared to ERS projections released in February that suggested net farm income would fall 26%. The primary cause for 2024’s decline in farm income is commodity prices. Cash receipts or sales are expected to fall by $27.7 billion. When combined with the inventory adjustment for crops, the value of crop production is forecast to decrease by $25.6 billion from 2023, with the largest decline coming from corn and soybeans. Fertilizer expenses for crop farmers are expected to fall by almost 10%.
- In July, the USDA began accepting applications through its Emergency Assistance for Livestock, Honeybees, and Farm-raised Fish Program (ELAP) to provide financial assistance to eligible dairy producers who incur milk losses due to Highly Pathogenic Avian Influenza (H5N1) infection in their dairy herds. The USDA expanded its Farm Service Agency ELAP through the rule-making process to assist with a portion of financial losses resulting from reduced milk production when cattle are removed from commercial milking in dairy herds having a confirmed positive H5N1 test. To qualify for assistance, positive test results must be confirmed through the USDA’s Animal and Plant Health Inspection Service. H5N1 infections have been detected in dairy cows in a dozen states, including Colorado, Kansas, Michigan, Minnesota, New Mexico, Ohio, and Texas. An outbreak of bird flu can cost dairy producers in some states $10,000 a day in lost revenue due to reduced milk production.
- Most US farmers and ranchers can expect to pay more for labor this year, according to the USDA’s Farm Labor Survey (FLS). According to the FLS, workers hired directly by farm operators in 13 states will pay more than $1 more per hour to their H-2A employees (the visa program for foreign temporary agricultural workers) in 224 than they did in 2023, while farmers in 31 states will pay between 50 cents and $1 more. Only in six states is the increase for 2024 less than 50 cents per hour. The smallest increase is forecast for the Midwestern states (Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Ohio, and Wisconsin), while the largest percentage increase is in Hawaii, where farmers can expect to pay $1.49 per hour more this year for H-2A program workers than they did in 2023.
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