Family farm

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Family farm, Wisconsin.

A family farm is generally understood to be a farm owned and/or operated by a family. However, specific definitions vary, as noted below. At least 500 million of the world's estimated 570 million farms are managed by families, making family farms predominant in global agriculture.[1][2]

Alternatives to family farms are of many kinds. For example, in the United States, non-family farms include single proprietorships where the owner is not the farm operator, non-family partnerships, estates, trusts, non-family corporations, cooperatives, collectives, institutional, research, experimental and American Indian Reservation farms.

Definitions of “family farm”[edit]

A review of sources in English, Spanish and French found 36 definitions of “family farm”, from academic research, international organizations and various kinds of government sources. Definitions referred to one or more of labor, management, size, provision of family livelihood, residence, family ties and generational aspects, community and social networks, subsistence orientation, patrimony, land ownership and family investment.[3] The disparity of definitions reflects national and geographical differences in cultures, rural land tenure, and rural economies, as well as the different purposes for which definitions are coined.

The 2012 United States Census of Agriculture defines a family farm as “any farm where the majority of the business is owned by the operator and individuals related to the operator, including relatives who do not live in the operator’s household”; it defines a farm as “any place from which $1,000 or more of agricultural products were produced and sold, or normally would have been sold, during a given year.”[4]

The Food and Agriculture Organization of the United Nations defines a “family farm” as one that relies primarily on family members for labour and management.[5]

In some usage, “family farm” implies that the farm remains within the ownership of a family over a number of generations.[6]

Being special-purpose definitions, the definitions found in laws or regulations may differ substantially from commonly understood meanings of “family farm”. For example, In the United States, under federal Farm Ownership loan regulations, the definition of a “family farm” does not specify the nature of farm ownership, and management of the farm is either by the borrower, or by members operating the farm when a loan is made to a corporation, co-operative or other entity. The complete definition can be found in the US Code of Federal Regulations 7 CFR 1943.4.

Perceptions of the family farm[edit]

In developed countries the family farm is viewed sentimentally, as a lifestyle to be preserved for tradition's sake, or as a birthright. It is in these nations very often a political rallying cry against change in agricultural policy, most commonly in France, Japan, and the United States, where rural lifestyles are often regarded as desirable. In these countries, strange bedfellows can often be found arguing for similar measures despite otherwise vast differences in political ideology. For example, Patrick Buchanan and Ralph Nader, both candidates for the office of President of the United States, held rural rallies together and spoke for measures to preserve the so-called family farm. On other economic matters they were seen as generally opposed, but found common ground on this one.

The social roles of family farms are much changed today. Until recently, staying in line with traditional and conservative sociology, the heads of the household were usually the oldest man followed closely by his oldest sons. The wife generally took care of the housework, child rearing, and financial matters pertaining to the farm. However, agricultural activities have taken on many forms and change over time. Agronomy, horticulture, aquaculture, silviculture, and apiculture, along with traditional plants and animals, all make up aspects of today's family farm. Farm wives often need to find work away from the farm to supplement farm income and children sometimes have no interest in farming as their chosen field of work.

Bolder promoters argue that as agriculture has become more efficient with the application of modern management and new technologies in each generation, the idealized classic family farm is now simply obsolete, or more often, unable to compete without the economies of scale available to larger and more modern farms. Advocates argue that family farms in all nations need to be protected, as the basis of rural society and social stability.

Viability of the family farm[edit]

Synergy Farm, a family farm in central New York state.

According to the United States Department of Agriculture, ninety-eight percent of all farms in the U.S. are family farms. Two percent of farms are not family farms, and those two percent make up fourteen percent of total agricultural output in the United States, although half of them have total sales of less than $50,000 per year. Overall, ninety-one percent of farms in the United States are considered "small family farms" (with sales of less than $250,000 per year), and those farms produce twenty-seven percent of U.S. agricultural output.[7]

Depending on the type and size of independently owned operation, some limiting factors are:

  • Economies of scale: Larger farms are able to bargain more competitively, purchase more competitively, profit from economic highs, and weather lows more readily through monetary inertia than smaller farms.
  • Cost of inputs: fertilizer and other agrichemicals can fluctuate dramatically from season to season, partially based on oil prices, a range of 25% to 200% is common over a few year period.
  • oil prices: Directly (for farm machinery) and somewhat less directly (long distance transport; production cost of agrichemicals), the cost of oil significantly impacts the year-to-year viability of all mechanized conventional farms.
  • commodity futures: the predicted price of commodity crops, hogs, grain, etc., can determine ahead of a season what seems economically viable to grow.
  • technology user agreements: a less publicly known factor, patented GE seed that is widely used for many crops, like cotton and soy, comes with restrictions on use, which can even include who the crop can be sold to.
  • wholesale infrastructure: A farmer growing larger quantities of a crop than can be sold directly to consumers has to meet a range of criteria for sale into the wholesale market, which include harvest timing and graded quality, and may also include variety, therefore, the market channel really determines most aspects of the farm decisionmaking.
  • availability of financing: Larger farms today often rely on lines of credit, typically from banks, to purchase the agrichemicals, and other supplies needed for each growing year. These lines are heavily affected by almost all of the other constraining factors.
  • government economic intervention: In some countries, notably the US and EU, government subsidies to farmers, intended to mitigate the impact on domestic farmers of economic and political activities in other areas of the economy, can be a significant source of farm income. Bailouts, when crises such as drought or the "mad cow disease" problems hit agricultural sectors, are also relied on. To some large degree, this situation is a result of the large-scale global markets farms have no alternative but to participate in.
  • government and industry regulation: A wide range of quotas, marketing boards and legislation governing agriculture impose complicated limits, and often require significant resources to navigate. For example, on the small farming end, in many jurisdictions, there are severe limits or prohibitions on the sale of livestock, dairy and eggs. These have arisen from pressures from all sides: food safety, environmental, industry marketing.
  • real estate prices: The growth of urban centers around the world, and the resulting urban sprawl have caused the price of centrally located farmland to skyrocket, while reducing the local infrastructure necessary to support farming, putting effectively intense pressure on many farmers to sell out.

Over the 20th century, the people of developed nations have collectively taken most of the steps down the path to this situation. Individual farmers opted for successive waves of new technology, happily "trading in their horses for a tractor", increasing their debt and their production capacity. This in turn required larger, more distant markets, and heavier and more complex financing. The public willingly purchased increasingly commoditized, processed, shipped and relatively inexpensive food. The availability of an increasingly diverse supply of fresh, uncured, unpreserved produce and meat in all seasons of the year (oranges in January, freshly killed steers in July, fresh pork rather than salted, smoked, or potassium-impregnated ham) opened an entirely new cuisine and an unprecedented healthy diet to millions of consumers who had never enjoyed such produce before. These abilities also brought to market an unprecedented variety of processed foods, such as corn syrup and bleached flour. For the family farm this new technology and increasingly complex marketing strategy has presented new and unprecedented challenges, and not all family farmers have been able to effectively cope with the changing market conditions.

21st century North America[edit]

A family-owned wheat planting rig, Western North Dakota.

United States[edit]

In 2012, the United States had 2,039,093 family farms (as defined by USDA), accounting for 96.7 percent of all farms and 89 percent of census farm area in the United States. [8]

Because of the predominance of family farms, the types of farming conducted on US family farms are essentially those of US agriculture overall. A USDA survey conducted in 2011 estimated that family farms account for 85 percent of US farm production and 85 percent of US gross farm income. Mid-size and larger family farms account for 60 percent of US farm production and dominate US production of cotton, cash grain and hogs. Small family farms account for 26 percent of US farm production overall, and higher percentages of production of poultry, beef cattle, some other livestock and hay.

Several kinds of US family farms are recognized in USDA farm typology:

Small family farms are defined as those with annual gross cash farm income (GCFI) of less than $350,000; in 2011, these accounted for 89.71 percent of all US farms. Because low net farm incomes tend to predominate on such farms, most farm families on small family farms are extremely dependent on off-farm income. Small family farms in which the principal operator was mostly employed off-farm accounted for 41.87 percent of all farms and 14.6 percent of total US farm area; median net farm income was $788. Retirement family farms were small farms accounting for 16.29 percent of all farms and 6.5 percent of total US farm area; median net farm income was $5,002.

The other small family farm categories are those in which farming occupies at least 50 percent of the principal operator’s working time. These are:

Low-sales small family farms (with GCFI less than $150,000); 26.10 percent of all US farms, 17.6 percent of total US farm area, median net farm income $3,579.

Moderate-sales small family farms (with GCFI of $150,000 to $349,999); 5.44 percent of all US farms, 13.4 percent of total US farm area, median net farm income $67,986.

Mid-size family farms (GCFI of $350,000 to $999,999); 5.66 percent of all US farms, 21.7 percent of total US farm area; median net farm income $154,538.

Large family farms (GCFI $1,000,000 to $4,999,999); 1.77 percent of all US farms, 14.1 percent of total US farm area; median net farm income $476,234.

Very large family farms (GCFI over $5,000,000); 0.18 percent of all US farms, 2.1 percent of total US farm area; median net farm income $1,910,454.[9]

Family farms include not only sole proprietorships and family partnerships, but also family corporations. Family-owned corporations account for 4.5 percent of all farms and 89 percent of corporate farms in the United States. About 98 percent of US family corporations owning farms are small, with no more than 10 shareholders; average net farm income of family corporate farms was $189,400 in 2012. (In contrast, 90 percent of US non-family corporations owning farms are small, having no more than 10 shareholders; average net cash farm income for US non-family corporate farms was $270,670 in 2012.)[8]

Canada[edit]

In Canada, the number of “family farms” cannot be inferred closely, because of the nature of census data, which do not distinguish family and non-family farm partnerships. In 2011, of Canada’s 205,730 farms, 55.4 percent were sole proprietorships, 24.5 percent were partnerships, 17.4 percent were family corporations, 2.4 percent were non-family corporations and 0.3 percent were other categories.[10] Because some but not all partnerships involve family members, these data suggest that family farms account for between about 72.8 and 97.3 percent of Canadian farms. The family farm percentage is likely to be near the high end of this range, for two reasons. The partners in a [Canadian] farm partnership are typically spouses, often forming the farm partnership for tax reasons.[11] Also, as in the US,[12] family farm succession planning can use a partnership as a means of apportioning family farm tenure among family members when a sole proprietor is ready to transfer some or all of ownership and operation of a farm to offspring. Conversion of a sole proprietorship family farm to a family corporation may also be influenced by legal and financial, e.g. tax, considerations. The Canadian Encyclopedia estimates that more than 90 percent of Canadian farms are family operations.[13] In 2006, of Canadian farms with more than one million dollars in annual gross farm receipts, about 62.5 percent were family corporations and 13.1 percent were non-family corporations.[14]

Family farms in other regions[edit]

Analysis of data for 59,000 farms in the 12 member states of the European Community found that in 1989, about three-quarters of the farms were family farms, producing just over half of total agricultural output.[15]

As of 2010, there were approximately 139,900 family farms in Ireland, with an average size of 35.7 hectares per holding. (Nearly all farms in Ireland are family farms.)[16][17][18] In Ireland, average family farm income was 25,483 euros in 2012. Analysis by Teagasc (Ireland’s Agriculture and Food Development Authority) estimates that 37 percent of Irish farms are economically viable and an additional 30 percent are sustainable due to income from off-farm sources; 33 percent meet neither criterion and are considered economically vulnerable.[19]

In sub-Saharan Africa, 80% of farms are family owned and worked.[20]

In southern Africa “On peasant family farms ..., cash input costs are very low, non‐household labour is sourced largely from communal work groups through kinship ties, and support services needed to sustain production are minimal.” On commercial family farms, “cash input costs are high, little non‐family labour is used and strong support services are necessary.”[21]

In Brazil, there are about 4.37 million family farms. These account for 84.4 percent of farms, 24.3 percent of farmland area and 37.5 percent of the value of agricultural production.[2]

Local food and the organic movement[edit]

In the last few decades there has been a resurgence of interest in organic and free range foods. A percentage of consumers have begun to question the viability of industrial agriculture practices and have turned to organic groceries that sell products produced on family farms including not only meat and produce but also such things as wheat germ breads and natural lye soaps (as opposed to bleached white breads and petroleum based detergent bars). Others buy these products direct from family farms. The "new family farm" provides an alternative market in some localities with an array of traditionally and naturally produced products.

Such "organic" and "free-range" farming is attainable where a significant number of affluent urban and suburban consumers willingly pay a premium for the ideals of "locally produced produce" and "humane treatment of animals". Sometimes, these farms are hobby or part-time ventures, or supported by wealth from other sources. Viable farms on a scale sufficient to support modern families at an income level commensurate with urban and suburban upper-middle-class families are often large scale operations, both in area and capital requirements. These farms, family owned and operated in a technologically and economically conventional manner, produce crops and animal products oriented to national and international markets, rather than to local markets. In assessing this complex economic situation, it is important to consider all sources of income available to these farms; for instance, the millions of dollars in farm subsidies which the United States government offers each year. As fuel prices rise, foods shipped to national and international markets are already rising in price.

International Year of Family Farming[edit]

Logo of International Year of Family Farming 2014
International Year of Family Farming. Postage stamp of the Republic of Belarus

At the 66th session of the United Nations General Assembly, 2014 was formally declared to be the “International Year of Family Farming” (IYFF).[22] The Food and Agriculture Organization of the United Nations was invited to facilitate its implementation, in collaboration with Governments, International Development Agencies, farmers' organizations and other relevant organizations of the United Nations system as well as relevant non-governmental organizations.

The goal of the 2014 IYFF is to reposition family farming at the centre of agricultural, environmental and social policies in the national agendas by identifying gaps and opportunities to promote a shift towards a more equal and balanced development. The 2014 IYFF will promote broad discussion and cooperation at the national, regional and global levels to increase awareness and understanding of the challenges faced by smallholders and help identify efficient ways to support family farmers.

See also[edit]

References[edit]

  1. ^ http://www.fao.org/news/story/en/item/260535/icode/
  2. ^ a b Lowder, S. K., J. Skoet and S. Singh. 2014. What do we really know about the number and distribution of farms and family farms worldwide? http://www.fao.org/docrep/019/i3729e/i3729e.pdf
  3. ^ Garner, E. and A. P. de la O Campos. 2014. Identifying the “family farm” – An informal discussion of the concepts and definitions. ESA Working Paper 14-10. FAO, Rome.
  4. ^ United States Department of Agriculture. 2015. 2012 Census of Agriculture. Farm typology. Vol. 2. Subject series. Part 10. AC-12-S-10.
  5. ^ http://www.fao.org/news/story/en/item/207544/icode
  6. ^ Bjørhaug, H. and A. Blekesaune. 2008. Gender and work in Norwegian family farms. Sociologia ruralis 48: 152-165.
  7. ^ USDA's "U.S. Farms: Numbers, Size, and Ownership"
  8. ^ a b United States Department of Agriculture. 2014. 2012 Census of agriculture. United States summary and state data. Volume 1. Geographic area series. Part 51 AC-12-A-51.
  9. ^ Hoppe, R.A. 2014. Structure and finances of U.S. farms: family farm report, 2014 edition. United States Department of Agriculture, Economic Research Service EIB-132.
  10. ^ Statistics Canada. 2011 Census of Agriculture.
  11. ^ Family farm partnerships. http://www.mnp.ca/en/media-centre/library/2010/10/1/family-farm-partnerships
  12. ^ http://www.extension.umn.edu/agriculture/business/farm-transfer-estate-planning/docs/farm-business-transfer-strategies-2014.pdf
  13. ^ Canadian Encyclopedia. Farm law. http://www.thecanadianencyclopedia.ca/en/article/farm-law/
  14. ^ Statistics Canada. The financial picture of farms in Canada. http://www.statcan.gc.ca/ca-ra2006/articles/finpicture-portrait-eng.htm
  15. ^ Hill, B. 1993. The myth of the family farm: defining the family farm and assessing its importance in the European Community. J. Rural Studies 9: 359-370.
  16. ^ Teagasc. Agriculture in Ireland http://www.teagasc.ie/agrifood/
  17. ^ Ireland and the Common Agricultural Policy (CAP) http://ec.europa.eu/ireland/key-eu-policy-areas/agriculture/index_en.htm
  18. ^ 2000 World Census of Agriculture. Main results and metadata by country. 1996-2005. http://www.fao.org/docrep/013/i1595e/i1595e.pdf
  19. ^ http://www.teagasc.ie/publications/2013/1935/NFSincomeestimates 2012.pdf
  20. ^ European Parliamentary Research Service. 2014 International Year of Family Farming http://epthinktank.eu/2014/04/14/2014-international-year-of-family-farming/
  21. ^ Low, A., P. Akwenye and K. Kamwi. 1999. 2008. Small-family farm types: examples from Northern Namibia and implications for agrarian reform in South Africa. Development Southern Africa 16: 335-344.
  22. ^ Official Website of the International Year of Family Farming 2014, Food and Agriculture Organization of the United Nations, 21 November 2013 
  • Thomas, Frieder; Schmidt, Götz (2006). Förderung von Existenzgründungen in der Landwirtschaft: ein Projekt im Auftrag des BMELV (03HS016): Projektbericht. Münster-Hiltrup: Landwirtschaftsverlag. ISBN 3-7843-0513-X. 

External links[edit]

Further reading[edit]