Structure and Finances of U.S. Farms: Family Farm Report ... - AgWeb

“point system” assigns values for acres of various crops and head of livestockto estimate normal sales. Point farms are farms with less than $1,000 in salesbut points worth at least $1,000. 3Nonfamily farms are also concentrated in the lower sales classes. Fifty-eightpercent have sales less than $50,000, and 76 percent have sales less than$250,000 and would qualify as small farms. The only criteria necessary to beclassified as a nonfamily farm is that the operator and the operator’s relativesdo not own a majority of the business. Thus, nonfamily farms include morethan large farms operated by publicly held corporations. They also include,for example, a farm equally owned by unrelated business partners, as well asfarms operated by hired managers unrelated to the owners. Only 15 percentof nonfamily farms are corporations, and only 11 percent of these corporationshave more than 10 stockholders.3For more information, see “What is theDefinition of a Farm?” on the USDA,National Agricultural Statistics Servicewebsite at: www.agcensus.usda.gov/help/faqs/2002_census/index.asp#1.Median Acres OperatedThe average (or mean) acreage operated is fairly low for both retirement andresidential/lifestyle farms, 174 and 148 acres, respectively. Average acreageoperated, however, may not best indicate the size of a typical farm in a groupbecause a few high-acreage farms may raise the average well above theacreage operated on most farms. Median acreage operated—the midpointof the distribution of farms by acres operated—is a better indicator. Medianacreage operated is 69 acres for retirement farms and 58 acres for residential/lifestyle farms, which means the typical farm in both of these groups is evensmaller than suggested by the groups’ average acreages.Median acres operated was 110 acres among low-sales farms, nearly doublethe medians for retirement or residential/lifestyle farms. Median acreage ismuch larger for medium-sales small farms and large-scale farms, rangingfrom 414 to 1,062 acres. The high average acreage for nonfamily farms(1,099 acres) reflects a small share of farms in the group with very large acreages.In contrast, the median for this group is about one-sixth as large—188acres—which is more consistent with the 76-percent share of nonfamilyfarms with annual sales less than $250,000.Million-Dollar FarmsThirty-seven percent of very large family farms and 13 percent of nonfamilyfarms are “million-dollar farms” with annual sales of $1 million or more.There are only 47,600 million-dollar farms—2 percent of all U.S. farms—but they account for 53 percent of production. They dominate the productionof five major farm products: high-value crops (vegetables, fruits and treenuts, and nursery and greenhouse products), hogs, dairy, poultry, and beef.The largest million-dollar farms—those with sales of at least $5 million—by themselves account for 35 to 45 percent of the production for beef cattle(largely in feedlots), high-value crops, and milk. For more information aboutmillion-dollar farms, see box “Million-Dollar Farms” or Million-DollarFarms in the New Century (Hoppe et al., 2008).9Structure and Finances of U.S. Farms: Family Farm Report, 2010 Edition / EIB-66Economic Research Service/USDA