The 2002 Census of Agriculture released last month by USDA confirms that four major trends in the cattle industry are continuing. Those trends include:
Consolidation. The number of U.S. beef farms fell by more than 103,000 operations from 1997 to 2002, to just below a total of 800,000. Farms with 50-200 head continue to decrease in number while bigger producers are growing in size and number(s). The number of dairy farms dropped even more dramatically, going from 125,041 to 91,989.
Beef cow numbers fell by nearly 800,000 head, while dairy numbers remained constant from 1997 to 2002. And, the number of people working full time on the farm or ranch is increasing with the increase in farm size.
Average age of producers is 55.3 years. The average age has risen at a rate of one year for every five years since the 1978 census. That increasing age figure raises the issue about the transfer of assets that will have to occur at some point from one generation to the next.
Land, labor and equipment costs are rising, with labor being the fastest growing segment of farm expenses. However, values for land and buildings jumped by nearly 24% in the last five years, while equipment value increased by nearly 20%.
A changing marketing structure. Organic sales, and direct sales of ag products, continue to grow but remain relatively small from a dollar standpoint. The demand strength is evidenced by the falling number of sales but the increase in total dollars generated from beef sales.
Another interesting trend is that the only category of farm or ranch that grew in number during the census period was the hobby farmer/rancher with less that $2,500 in sales. Not surprisingly, the changes in the latest farm bill led to an 18.4% reduction in the number of corporate farms, reversing a trend that started in 1974. In addition, 90% of farms are operated by an individual or family.
For more detail, go to www.usda.gov/nass/ and click on “Census of Agriculture.”