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 9,350 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 Farm Production
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 workers and generates $2-3 million in annual revenue.
- The farm support services industry includes about 9,345 companies that employ some 95,720 workers and generate around $24.5 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, Florida, Washington, and Oregon are home to most farm support services providers.
Industry Forecast
Farm Support Services Industry Growth
Recent Developments
Mar 30, 2024 - 2024 Farm Income to Fall
- Net farm income – a broad measure of farm profitability – is projected to decline this year compared to last, according to the latest USDA Farm Sector Income Forecast. In inflation-adjusted 2024 dollars, net farm income is forecast to fall by $43.1 billion (27.1%) from 2023 to 2024, and net cash farm income is forecast to decrease by $42.2 billion (25.8%) compared to last year If realized, both measures in 2024 would fall below their 2003-2022 averages (in inflation-adjusted dollars). Overall, farm cash receipts are forecast to decrease by $21.2 billion (4.2%) from 2023 to $485.5 billion in 2024 in nominal dollars. Direct Government farm payments are forecast at $10.2 billion in 2024, a $1.9 billion drop from 2023. Total production expenses are forecast to increase by $16.7 billion from 2023 to $455.1 billion in 2024.
- 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 decline, 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 2022 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.
- Most US farmers and ranchers can expect to pay more for labor this year, according to the USDA’s Farm Labor Survey (FLS) published in November. 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) 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.
- The US Gulf Coast has become a magnet for fertilizer companies looking to produce climate-friendly blue ammonia thanks to generous subsidies in the Inflation Reduction Act and its existing export structure, Reuters reports. So-called blue ammonia is a low-emissions compound consisting of hydrogen and nitrogen to make fertilizer. Facilities under construction include a 1.1 million metric ton per year plant at Beaumont, Texas built by Dutch fertilizer producer OCI. The OCI plant, slated to open in 2025, would be the world's first new commercial facility to capture and sequester 95% of the emissions produced by making ammonia. Norway’s Yara is looking to invest in a blue ammonia plant in Ingleside, Texas that would capture about 95% of the carbon emissions. Other companies looking to build low-emissions ammonia projects along the Gulf Coast include Exxon Mobil, BASF, and LOTTE Chemical, Mitsubishi and RWE, according to Reuters.
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