Secretary of Agriculture Tom Vilsack has a comment on the state of small-scale farming in America today.
It is taken from the National Agricultural Statistics Service, which shows that as the average size of farms has increased, the country has lost 544,000 since 1981.
“That’s every farm that exists today in North Dakota and South Dakota, added to those in Wisconsin and Minnesota, added to those in Nebraska and Colorado, added to those in Oklahoma and Missouri,” Vilsack said this spring at a conference in Washington. “Are we okay with it as a country?”
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While the United States continues to produce more food on fewer acres, Vilsack worries that the loss of small farmers has weakened rural economies, and he wants to stop the bleeding. Unlike his last turn in the same role under President Barack Obama, this time his department can spend billions of dollars on grants and incentives passed under three major laws since 2021 — including the largest investment in conservation programs in the history of the United States. USA
The plan in a nutshell: multiply and improve revenue streams to strengthen farm balance sheets. Instead of just selling crops and livestock, farms of the future could also sell carbon credits, waste products and renewable energy.
“Instead of the farm getting one check, they could potentially get four checks,” Vilsack said in an interview. He also helps schools, hospitals and other institutions buy locally grown food, and investors build meatpacking plants and other processing facilities to free farmers from powerful middlemen.
But it’s far from clear whether new policies and a cash infusion will be enough to counter the forces that have driven farmers from their land for decades — especially as much of the money is aimed at cutting carbon emissions, and will therefore also go to large agricultural companies. because they are the biggest polluters.
The number of farms has declined since the 1930s, largely due to rural-to-urban migration and the greater mechanization of agriculture, which has allowed farmers to farm larger areas with fewer people. Over time, the federal government has abandoned production management policies to support prices, causing growers to focus more on exports while local distribution networks withered.
The past half-decade has been more disruptive than most. First came a trade war against China under President Donald Trump, which brought retaliatory tariffs that hampered U.S. exports of agricultural products such as soybeans and pork. Then came the pandemic, which disrupted supply chains and undermined agricultural labor, causing crops to rot in the fields.
After Congress cushioned the blow with aid for farmers hit by pandemic disruptions, things started to turn around. Even as the cost of supplies such as fertilizer and seed rose, so did food prices and farm incomes. In 2023, agricultural loan default rates approached record lows.
“Farm balance sheets overall are the healthiest they’ve ever been,” said Brad Nordholm, CEO of Farmer Mac, a major secondary market for agricultural loans. “The tools available to American farmers to achieve more predictable returns, even as commodity and input prices change, are greater than ever before.”
But wholesale crop prices are expected to decline in the coming year. Rising interest rates have made it harder to finance planting and harvesting, borrow for expansion or simply get into farming – especially since land values have risen 29% between 2020 and 2023.
That’s especially true for the smallest farmers, who are much less likely to qualify for Department of Agriculture assistance programs and more vulnerable to adverse weather conditions, labor shortages and consumer whims.
“I think in some ways they are in a worse position than they were before the pandemic,” said Benneth Phelps, executive director of the nonprofit Carrot Project, which advises small farmers in New England. “We’re seeing a lot of farmers making tough decisions right now about whether to stay in or go out because they’re running out of strength.”
That’s where the American Rescue Plan, the Inflation Reduction Act, and the Bipartisan Infrastructure Law come into the picture.
The laws collectively provided about $60 billion to the Department of Agriculture, which allocated it across several priorities, from easing farmers’ debt to paying farmers to reduce their carbon emissions.
The largest portion — about $19.5 billion — has revived subsidies to encourage conservation practices that improve the land, such as cutting back on plowing and planting cover crops to sequester carbon in the soil. Some of the programs were shrunk in successive farm bills, which are five-year legislative packages that cover most farm subsidies, and about two-thirds of farmers who applied each year got nothing.
The new funding has added 16,000 recipients over the past two years. Preliminary data shows that the expansion will allow smaller companies to participate.
Some of that money — combined with another renewable energy pot from the Department of Agriculture — will be used to purchase a $2.9 million methane digester at Savage View Farm, a 700-heifer dairy farm in Grand Isle , Vermont.
Fed with large amounts of manure, the machines will generate electricity that is sold back to the local utility and dehydrated solids that can be used for cow bedding. An Inflation Reduction Act tax credit will reduce the farm’s tax liability, and in terms of non-financial benefits, the facility will reduce odors generated by spreading raw manure on fields.
“We have an abundance of manure,” said Sara Griswold, a farm manager who is engaged to one of the farm’s owners. “It will make the experience of distributing a little more enjoyable for those around us.”
Another $3.1 billion will pay farmers who are willing to do a little more monitoring, verification and reporting to build on the science of what actually works to reduce carbon emissions.
The hope is that producers can charge a premium for goods advertised as climate-friendly. Consumers say they are willing to pay more, and in Europe many food companies are under regulatory pressure to source ingredients with a smaller carbon footprint. For additional revenue, the Ministry of Agriculture envisions developing markets where polluting companies buy carbon offsets from farms that have reduced their own emissions.
However, not everyone supports these initiatives. For starters, it can be difficult for smaller farmers to take advantage of this. For example, the methane digester at Savage View Farm is not cost-effective for dairy herds of fewer than about 200 cows.
Scientists also worry that the climate benefits are overestimated, and that further subsidizing farms – especially those with methane-producing livestock – could actually increase greenhouse gases from the sector overall.
“Agriculture in general, especially when it comes to meat and dairy, produces higher emissions than it sequesters,” said Matthew Hayek, an assistant professor at New York University’s department of environmental studies. “The more money you put into agriculture, the more agriculture will happen.”
To help small farmers more directly, the Department of Agriculture has made additional funding available to help potential farmers get started and help local producers find buyers for crops other than dominant commodities such as corn and soybeans.
The effort includes $300 million to help historically marginalized and aspiring farmers – including Black, Hispanic, recent immigrants and Native American growers – gain access to land. The program was massively oversubscribed, and the money has now been distributed to nonprofits across the country that build community land trusts, help heirs gain clear title to family lands, and provide technical assistance to those just getting started.
Another bottleneck facing smaller farmers is the availability of meat and poultry processors, an industry that has been consolidated under major companies like Cargill and Tyson Foods. To solve this problem, the Department of Agriculture has revived enforcement of long-neglected antitrust laws and invested $1 billion in building or expanding factories.
After land is secured, clients determine whether the farm will wither or flourish. A smaller operation often cannot survive on commodity prices alone, so it needs individual buyers who are willing to pay a little more for a wider range of crops.
The Department of Agriculture has tried to address that problem with $900 million to encourage institutions to buy from local producers and by creating a network of regional food business centers.
Many farmers say the money has been helpful, but it still hasn’t completely flowed through America’s mountains and plains. Graham Christensen’s family has farmed about 1,000 acres in eastern Nebraska since arriving as homesteaders in the late 1800s. The family now mainly deals in white corn and soybeans, and is diversifying into hazelnuts, cherries and pecans. These are usually high-value crops, but only if someone buys something, such as a supermarket chain or a packaged food company.
“We can’t go anywhere with those products once we’re done,” Christensen said. “Those are the markets we want, and we have no way to get there.”
That’s why Christensen, and groups like the National Family Farm Coalition and American Farmland Trust, are pushing for the new funding to continue in the upcoming farm bill. They want billions more in land transferred from retired farmers to small business owners instead of corporations, and for the Department of Agriculture to create an Office of Small Farms to oversee it all.
They point out that some of the money could come from the subsidies that have supported giant producers of wheat, corn and other agricultural products for years.
“It’s about moving investments away from just one type of farm to be more inclusive,” said Carolina Mueller, deputy director of the Young Farmers Coalition. “This is a great potential source of financial support that could serve young, beginning and, frankly, not so young farmers.”
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