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U.S. agriculture and rural life underwent a tremendous transformation in the 20th century. Early 20th century agriculture was labor intensive, and it took place on many small, diversified farms in rural areas where more than half the U.S. population lived. Agricultural production in the 21st century, on the other hand, is concentrated on a smaller number of large, specialized farms in rural areas where less than a fourth of the U.S. population lives. The following provides an overview of these trends, as well as trends in farm sector and farm household incomes.
After peaking at 6.8 million farms in 1935, the number of U.S. farms fell sharply until the early 1970s. Rapidly falling farm numbers during the earlier period reflected growing productivity in agriculture and increased nonfarm employment opportunities. Since 1982, the number of U.S. farms has continued to decline, but much more slowly. In the most recent survey, there were 1.89 million U.S. farms in 2023, down 7 percent from the 2.04 million found in the 2017 Census of Agriculture. Similarly, acres of land in farms continued a downward trend with 879 million acres in 2023, down from 900 million acres in 2017. The average farm size was 464 acres in 2023, only slightly greater than the 440 acres recorded in the early 1970s.
Technological developments in agriculture have been influential in driving changes in the farm sector. Innovations in animal and crop genetics, chemicals, equipment, and farm organization have enabled continuing output growth without adding much to inputs. As a result, even as the amount of land, labor, and other inputs used in farming declined, total farm output nearly tripled between 1948 and 2021.
Gross cash farm income (GCFI) is annual income before expenses and includes cash receipts, farm-related income, and Government farm program payments. In inflation-adjusted 2024 dollars, GCFI is forecast at $549.8 billion in 2024, versus $400.3 billion in 2003, with the increase across time primarily due to higher cash receipts. If forecasts are realized, GCFI would decrease by 8.5 percent in 2023 relative to 2022 and further decrease by 6.1 percent in 2024 relative to 2023.
Gross farm income reflects the total value of agricultural output plus Government farm program payments. Net farm income (NFI) reflects income after expenses from production in the current year and is calculated by subtracting farm expenses from gross farm income. NFI considers cash, non-cash income, and expenses and accounts for changes in commodity inventories. The inflation-adjusted net farm income estimate was a record-setting $196.4 billion in 2022. In 2023, net farm income is forecast to have decreased by 18.9 percent relative to 2022 and is expected to further decrease by 27.1 percent in 2024. Farm production expenses are projected to have decreased in 2023 by 1.3 percent relative to 2022 and to increase by 1.6 percent in 2024.
Crop cash receipts totaled $278.2 billion in calendar year 2022. Receipts from corn and soybeans accounted for $148.5 billion (53.4 percent) of the total.
Cash receipts for animals and animal products totaled $258.5 billion in calendar year 2022. Cattle/calf receipts accounted for $86.1 billion (33.3 percent) of that total, while poultry and eggs receipts accounted for $77.0 billion (29.8 percent), and dairy receipts accounted for $57.3 billion (22.2 percent).
Gross cash farm income (GCFI) includes income from commodity cash receipts, farm-related income, and Federal Government payments. Family farms (where the majority of the business is owned by the operator and individuals related to the operator) of various types together accounted for 97 percent of U.S. farms in 2022. Small family farms (less than $350,000 in GCFI) accounted for 88 percent of all U.S. farms. Large-scale family farms ($1 million or more in GCFI) accounted for about 3 percent of farms and nearly 52 percent of the value of production.
Median total household income among all farm households ($95,418) exceeded the median total household income for all U.S. households ($74,580) in 2022. Median household income and income from farming increased with farm size and most households earned some income from off-farm employment. About 88 percent of U.S. farms are small family farms, with gross cash farm income less than $350,000. The households operating these farms typically rely on off-farm sources for the majority of their household income. In contrast, the median household operating large-scale farms earned $505,833 in 2022, and most of that came from farming.
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