Concerns rise for the future of the family farm
By CHELSEA HALL
What will we be eating in a decade if there are no farmers to replace the current farmers once they retire? For nearly 70 years, the number of U.S. farms has been declining, while the average age of farmers has been rising — it’s now 57 years old, according to the most recent U.S. Department of Agriculture statistics.
The fastest growing group of farm operators is those 65 years and over, while the number in the age group entering the farming profession is dwindling, according to USDA statistics. In 2002, there were 674,968 farm operators 65 years and older. By 2007, the number had risen to 823,435 farm operators, a significant increase in this oldest group of farmers. On the other hand, in 2002, there were 851,091 farm operators under 45 years old. That number dropped in the next five years to 732,322.
Eighty-one percent of farm owners under 45 years of age also work off the farm, according to the USDA. New farms tend to be smaller and have younger operators who also work off the farm. In a closer look, the 2007 Census of Agriculture shows a significant difference in the numbers of farmers at opposite ends of the age spectrum. In 2007, there were 54,147 farm operators under the age of 25, in comparison to 289,999 operators 75 years and over.
“There are not many new farmers — the replacements are children of current farmers,” said David Dugan, the OSU extension educator for Ag and Natural Resources.
One such replacement is Erik Scott of Georgetown, who was recently named Ohio’s Outstanding Young Farmer by the Ohio Farm Bureau Federation. The Outstanding Young Farmer contest is designed to help young farmers strengthen their business skills, develop marketing opportunities and receive recognition for their accomplishments. Contestants are judged on the growth of their farm businesses and involvement in Farm Bureau and their community.
Scott, 27, farms with his parents, growing corn, soybeans, tobacco, hay and pasture. They also raise beef cattle and operate a farm market that sells all natural beef, according to The News Democrat.
“The younger generation is having a tough time going into farming,” Scott said. “Some of that can be blamed on the older generation if they didn’t do estate planning.”
With no estate planning to provide for the transfer of a farm from one generation to the next, a farm may end up out on the open market. A research farm in Scott’s area recently sold in the vicinity of $3,800 to $3,900 an acre, bringing the total purchase price to $1.2 million. With banks requiring 20 percent down, that’s nearly a quarter of a million dollars a buyer would have to have up front to make the purchase. And that’s if the buyer qualifies — something difficult to accomplish for someone just trying to get started.
“It’s extremely hard to buy farms,” said Scott. “There are so many large operations competing for the farms that they bring an outlandish price. If you don’t have a chunk of money laying aside, you can’t make the down payment, and most young people lack the credit history to get a loan.
“That’s the hardest part — one person I know tried to buy his family’s farm, but he didn’t qualify for the loan. There went the hope of keeping the farm in the family. It’s really a let-down when that happens, after the grandparents or parents work so hard to pay for the farm and develop it, and then the children have to see it go out of the family. They need to leave the farm in a trust or an LLC (limited liability corporation).”
Fortunately for Scott, his maternal grandparents had the foresight to set up a plan to keep their family’s farmland in the capable hands of his parents, Frankie Stith-Scott and Fred Scott, and their descendants. The family has its own corporation, Walnut Farms, Inc., that owns the real estate. Scott, his parents and his sister are the shareholders. The corporation’s by-laws even protect the farm from becoming part of a divorce settlement in the future as the shares cannot be owned by anyone who is not a blood relative of his parents, according to Scott.
The farm is further protected from being lost through the risks involved in its operation. Walnut Farms does not operate the farm, but Scott and his father operate the farm under a completely separate partnership. The partnership owns all the equipment and livestock. In addition to the farm market for beef, they are also in the process of making their own brand.
“It’s one thing to buy a farm,” Scott explained. “It’s another to buy it and operate it. If an estate plan is done correctly, and you have a way to get started with a farm, then you have to have a way to operate it. To operate a farm takes a huge amount of capital. A lot of people dive in without consideration of market swings and droughts. They plan for a typical year, but when that doesn’t happen, they have to make a decision to either pay back the operating loan or make their mortgage payment.”
“People that have the potential of taking over farms are seeing more opportunities elsewhere for an occupation,” said Becky Minton, Peebles High School agriculture educator and FFA advisor. “When you consider the time, money and stress involved with farming, it makes sense that the younger generation is taking different paths for employment.
What is being done to increase the interest for younger farmers to stay in the farming business? Agricultural classes are offered at many high schools in Ohio, but the problem is that, from those groups of students, few of them are already “farm kids” and many are going into other aspects of agriculture, niche farming or are taking a completely different path in general, according to Minton. Students have been taught that unless there is a settled farm to be taken over, it is a very risky endeavor and for good reason, she said. “The problem I have, is what about the younger generation whose parents don’t farm?” questioned Scott. “It ‘s very, very tough for them to get started in farming, but I won’t say it can’t be done. First they would have to learn the practices and general knowledge they would need to be successful.”
Scott said he is still learning from his parents, and the experience they have is priceless. His father has spent his lifetime farming and works at the local equipment dealership. His mother is an agricultural finance major from The Ohio State University and has worked since graduation as a loan officer with USDA. They went through a major drought during the 1980s from two different perspectives. His mother saw the financial aspect from working with farmers going through the drought. His father saw the producer’s side.
“It would be really hard to replace their experience,” Scott said. “They can ask the right questions — is this the right time to start something new? Will the market hold? Their experiences are extremely valuable. That is really going to be what sets the farmers in the younger generation apart — will they be able to take the experience of the older generation and apply it?”
“What farmers do is essential and good, for the community, and for the future,” Minton said. “It is important to provide support for young people who are interested in agriculture and would like to begin a career in agriculture. Our well being depends upon those who choose to produce our food products… The important thing to remember is not to dwell on the issue but find ways to turn the trend around. As an agricultural educator, I feel an importance to educate everyone about agriculture and where our food comes from; and a sense of urgency to ensure that the art of farming is not lost.
“It seems that America has lost sight of the importance of agriculture in our country and our ability to feed the world,” said Minton. “However, when you look at all of the statistics and logically look around at what is happening in the U.S., the future of agriculture doesn’t look grim but is plentiful. On average each farmer in America produces enough food to feed 155 people, and one in seven Ohioans has an agriculture-related job, which is a huge increase, even in the last 50 years. It has been a tough couple of years for farmers, but they continue to produce a local, safe, affordable food supply so that people can still “talk” about farmers while their mouths are full of food.”
(Chelsea Hall is an intern at The People’s Defender in West Union, Adams County. Staff writer Carleta Weyrich also contributed to this story.)