97: The Percentage of U.S. Farms that Are Family-Owned


Family-Owned-Farms
By Dana Dagman

Dana, along with her husband and his parents, farm 2,500 acres of barley, corn, soybeans and wheat in Enderlin, North Dakota.

“Corporate farms” and “factory farms” are labels many people give to farms using modern equipment and technology. Following that definition then, you might think “family farms” would be operations using practices and technologies from a bygone era. In truth, a corporation is an ownership structure, not a farming practice. Most farms are modernized and may get labeled as “factory farms,” even though more than 97 percent of them are family-owned, like mine.

According to the U.S. Department of Agriculture (USDA), a family farm is owned primarily by the principal operator and his or her family members. Oftentimes, this ownership is passed down through the generations. For example, my husband and I are the fifth generation on our farm.

The other 2.4 percent of U.S. farms are classified by the USDA as owned by a “nonfamily,” which is divided further into subcategories, including corporate farms. Typically, even farms that fall under the “corporate farm” definition have no more than 10 shareholders and have likely incorporated for tax and management purposes.

Both of these definitions focus on ownership of the business and not on farming practices or farm size. In fact, according to the USDA’s Census of Agriculture, some family farms are very large, reaching sales of more than 5 million dollars, and half of nonfamily farms have less than $35,000 in sales per year.

It is important for farmers to have the freedom to choose a business model that works for them, and both family and corporate ownership have advantages. With a family ownership, input from shareholders isn’t needed, so business decisions are made by the people working on the farm every day. My husband and I make decisions about our farm at the dinner table with his parents. On the other hand, a corporation has the ability to seek outside investors to raise the large amount of capital required to run a farm today.

Oftentimes, the people who think of large farms as “factory farms” or corporate-owned are the ones who have never been to a farm and don’t know any farmers personally. The best way to get the facts is to talk to someone like me – a family farmer! What questions do you have?


10 Comments

Eric Bjerregaard

Keep posting the truth. As a suggestion How about an article lauding the economies of scale that allow “industrial techniques” to raise efficiency and thus help keep food prices lower.

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Matt Stiles

I agree. I’m 7th generation on a family farm. Couldn’t afford to let Dad pass it down (prohibitive taxes), so everything went into an LLC. Working with shares seems to be less restrictive and less expensive.

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Kathy

I had a non-farm person tell me that Pioneer has a lot of corporate farms. This surprised me so I inquired as to what made them think this. It was because of all the Pioneer seed signs they see along their travels. They thought that meant Pioneer owned the farm each place the sign was seen!! I explained that the Pioneer sign was only identifying the brand of seed planted in the field. It was family owned farm. This was an “eye opener” for me! (I am not supporting one brand of seed over another. This happened to be the signs they were at that time)

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Laura Maciel

I really enjoyed your article and definitions. I completely agree with you. We are farmers in San Diego, Ca., We run a small farm (20 acres)but grow about 15 to 18 varieties of organic vegetables. My question for you is if you’re farming methods include use of GMO’S . Just wondering, I’ve been reading about this and Monsanto’s power over so many farms, large or small. Just wondering.

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Dawn C Panda

How do you mean Monsanto has power over farms? It’s a company; farmers can choose to buy seed from Monsanto or not. Monsanto isn’t sending anyone out to tell farmers how they have to run their farms. They do patent their seed, but so do many other seed companies.

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Sheril

I think family farms are great as long as they are not getting entitlements or subsidies.

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Heather

I don’t believe in getting things for free for no reasons but Subsidies can help farmers survive when there has been a bad year with bad weather. It’s like someone’s company doing layoffs and the person getting unemployment.

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Byron Gearhart

All farms receive subsidies of some sort . Family farm definition means owned or operated by a group of family members. Also size or acres is not the definition of a family farm . The 20 acre vegetable farm in California has more value per square foot then some North Dakota grain farms have per acre. For those of you that think 5 million in gross sales is a lot my family farm of approximately 2500 acres cash grain is almost half of that . Most of my neighbors are 3500to 4500 acres and push that number pretty hard. I have a neighbor that is in excess of 20,000 acres run by two brothers all cash grain and they run into the limitations of the government on how much they can receive. We all finally reach the limitations of what can be legally done. Farming is no longer a way of life it is a full blown business. If you can manage a large business you can manage a large farm.

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