Reuters -- Agriculture Transforms as Farmers Age
May 11, 2002
Agriculture Transforms as Farmers Age
By Chris Stebbins
CHICAGO (Reuters) - Just 30 years old and committed to being among the 2 percent
of Americans who make a living farming, Kerry Gibson is feeling more and more like a
rarity.
Gibson is considered the cream of the crop when it comes to the nation's farmers. He
was awarded the distinguished young farmer award in 2001 by the largest U.S. farm
organization, the American Farm Bureau Federation, and now heads the bureau's
young farmer group.
Gibson is also the fifth generation of his family to work on the same farm, which has
grown from a 20-acre farmstead over a 100 years ago to 650 acres nestled in a valley
of the Wasatch mountain range in northern Utah.
But what makes Gibson unusual is that he represents a shrinking number of farmers
under the age of 35.
The latest U.S. Agriculture Census in 1997 found that about 8 percent of all U.S.
farmers were 35 or younger, down from 11 percent five years earlier. The largest
percentage of farmers, 32 percent, were 55 to 69 years old -- retirement age.
Younger farmers are fighting discouragement from low commodity prices, rising prices
for inputs such as fertilizer, and consolidation of farms as veteran farmers sell out to
developers or more-highly capitalized neighbors.
Like most other farmers, Gibson took up the farming challenge to raise his children on
the land, be his own boss and make enough money to earn a living.
"When I think about the challenge to remain profitable for the next 40 years of my
lifetime and trying to pass on the farm to my kids, I'm scared a lot," Gibson said. "But
I have to balance that with a sense of optimism and the fact that I love what I'm doing."
Kyle Phillips, 48, runs a 2,100 acre corn/soybean operation in southeastern Iowa and
began farming in 1974. Farming had a bright future then as demand for U.S.
agricultural products was high and there was little foreign competition. He, too, likes
the independence farming offers but has been concerned that the rural lifestyle and
communities may disappear as farms consolidate and young people are motivated to
move to the cities for jobs.
"If you don't have farmers in their 30s, sooner or later there's going to be a massive
consolidation as farms grow," Phillips said.
U.S. AGRICULTURE TURNING ON AGE
"Agriculture is turning on this age issue in the sense that it will influence what the
future is going to be like," said Andy Sofranko, rural sociologist with the University of
Illinois. "There will always be farmers to farm U.S. land. It's just that the farms are
going to be bigger."
The average farm size has grown to just under 500 acres in 1997, up from a mere 175
in 1940, according to the U.S. Census of Agriculture.
But industry experts said that number was deceiving as growers farming 5,000, 7,000
or even 10,000 acres, with much of the land rented, has become more common.
There were 34,000 fewer farms in 2001 compared with 1999. But bigger farms just
keep growing. In 1999, farms with sales of $250,000 or more represented 6.7 percent
of all U.S. farms and controlled 32 percent of the land, the USDA said. That compared
to 7.3 percent of farms with sales of $250,000 plus and 35 percent of the land just two
years later.
"Young farmers can't wait to get their hands on more land. Younger farmers realize
there is a new order out there in agriculture and they have to change; they have to be
better managers," Sofranko said.
Fierce competition from Brazil and Argentina for world export markets has sparked
some American farmers to raise more specialty foods geared to "niche" markets,
moving away from the lower-priced bulk commodity business.
Younger farmers are also investing in food processing, ethanol plants, and bakeries;
teaming up with neighbors to form marketing alliances; and aggressively selling their
crops under specialty contract markets.
"We do have competition. But I've always believed we'll be better off to send the
processed product overseas rather than the whole kernel," said Richard Peterson, 59,
who has been growing corn and soybeans for 39 years in southern Minnesota.
Peterson spends 80 to 100 days a year working with farm groups to expand U.S.
commodity markets. His special interest is corn made into plastics and fiber and
exported to Japan.
FARMING AN OLD PROFESSION
But the changing of the guard will not be quick. Farming is an old profession and
provides a retirement income for people whose main investment has been land -- the
farmer's long-time version of a 401-K.
Others may not have any family members following in their footsteps. For them, selling
has not been an option. In many cases, their farm has been in the family for 150 to
200 years.
Faced with this issue a decade ago, Sally Puttmann and her husband of Sioux City,
Iowa, began making plans for someone to take over their farm after they learned their
grown daughters were not interested in returning to the family farm.
At the time, Sally's husband was still living and the two, then in their early 50s, chose
an Iowa State University agriculture student to work for them one summer.
"That was 14 years ago and he's still with me. It's been good for both of us. I needed
him and he needed me," said Puttmann, who is now 66.
Puttmann said she rents the land on a cash/rent agreement but takes on some of the
yield and price risk as well. Slowly, her renter is buying her equipment and she has
given him first right of refusal to purchase the farm if her daughters decide to sell after
she is gone.
But farmers have to begin planning for this kind of transition long before retirement so a
young farmer can take up the financial challenge, she said.
"The debt would be so great for a young person to shoulder. They would never get out
from under it," Puttmann said.
Copyright © 2002 Reuters Limited. |
