The 2022 Ag Census Key Take Aways

The United States Department of Agriculture (USDA) just released their 2022 Agricultural Census. While this report predominantly serves as a guide for federal farm programs, policy, and funding decisions, it also provides us with valuable data that has cross-sector implications in urban and rural communities alike.

What is the Ag Census?

Every five years, the USDA’s National Agricultural Statistics Service (NASS) releases a report with more than 6 million data points on U.S. farms and ranches and the people who operate them. Officials survey any plot of land, rural or urban, that normally sells $1,000 worth of agricultural products, resulting in the only comprehensive source of information on land use and ownership, producer characteristics, production practices, income, and expenditures.

Food and fiber are more volatile than other industries. Producers must contend with crop failure, extreme weather, supply chain interruptions, and price booms and busts. These challenges contributed to a whopping 11% increase in food prices from 2021 to 2022, compared to a 2% average increase each year between 2013 and 2022). The information provided in the census helps to detect trends that can better inform market decisions and allow government agencies to provide support before the prices soar.

What is noteworthy about this year’s findings?

1. The number of U.S. farms is declining; but large farms continue to expand

U.S. farmland has been on the decline for some time, and the census revealed that this trend continued with 2% of farmland being lost between 2017 and 2022. However, in this timeframe, the U.S. lost 142,000 farms, a 7% loss. While smaller farms experienced most of the losses, larger farms with sales exceeding $1 million continued to expand; these larger farms now control two-thirds of all agricultural lands despite representing only 4% of total farms. In fact, the top 1% of farms (those generating $5 million or more in sales), account for 42% of all agricultural sales in the U.S. This consolidation has led to the concentration of commodities, with nearly three-fourths of farmland utilized by farms in just two categories¹ and more animals in harmful factory farms than ever¹. Unfortunately, this trend of inequity extends to demographics: 2017-2022 saw an 8% decrease in Black-owned farms — more than double any other demographic — and today 95% of U.S. farmers are white.

2. Organic farms decreased while demand for organic products continued to rise

With the rise of the health and environmentally conscious consumer, the organics market has seen exponential growth that is expected to dominate more than 90% of the global market by 2027. The census showed that while organic sales grew, the number of organic farms has continued to decrease. Retail businesses increasingly have to import organic goods from abroad due to lack of U.S. availability.

3. U.S. agricultural policy is driving inequality and consolidation

Current agricultural policy and market structures favor large-scale producers; there is also a longstanding history of discrimination and exclusion at the USDA. For example, government payments to farmers rose by 17% (largely due to pandemic relief), yet the number of farms receiving subsidies decreased by 25%, and subsidies disproportionately favor larger, wealthier farms over struggling small farmers. Among those receiving the subsidies, the largest farms accounted for only 11% of beneficiaries, yet received 64% of the total subsidies.

In organics and regenerative agriculture in general, market bottlenecks are prohibiting many producers from entering that value-added market. Very few agricultural producers are trained in the soil health practices that are necessary for the transition away from chemicals, and the lack of government policy and programmatic support for the transition hinders its adoption. However, the census did show an increase in organic farmers with access to federal crop insurance which begins to de-risk organic adaption. Additionally, national supply chain gaps are caused by missing aggregators; limited processing and manufacturing capacity; and the associated shortages of skilled labor. The impact of this was felt in the COVID-19 pandemic when supply chains failed and faced interruptions. You can read more about the “missing middle” of the supply chain in ASBN’s letter here.

A few glimmers of hope

1. A growing number of new and young farmers.

The U.S. is facing a farmer aging crisis. During the ag census, the average age of farmers increased by six months to 58, but the number of beginning farmers rose 2% to make up 29% of all farmers. The rise in average age is likely due to an increase in older beginning farmers. While most beginning farmers were under 35, the average age was 47.

2. A rise in Hawaiian and Pacific Islander farmers

Hawaiian and Pacific Islander farmers increased by 13%, with 50% being beginning farmers, possibly due to the resurgence of Native Hawaiian farming practices and the land back movement.

3. More farms are adopting renewable energy projects

Solar panels increased 30% on farms while wind power grew 2%, providing many farmers with supplemental income and increasing property values. Solar and wind both are continuing to increase thanks to the investments of the Inflation Reduction Act.

NASS will continue to analyze the data and release more detailed reports that will be used to inform decisions. For example, since the release of the ag census in mid-February, the data has been used to further inform the recommendations made to the USDA to advance equity in its programs.

The biggest takeaway from this year’s ag census is that the system is not working for most of the supply chain. Protecting local and regional supply chains is imperative for national security. Global weather shifts have affected crop yields, leading to uncertainties in food supply. The COVID-19 pandemic highlighted vulnerabilities, emphasizing the need for decentralization, localization, and diverse pathways in the food system to mitigate risks and enhance adaptability. The farm bill can begin to address some of these issues to advance a more resilient and regenerative supply chain, but it is seeming less and less likely that it is going to pass this year.

In the meantime, the USDA’s Agricultural Marketing Service has asked for input to information Specialty Crops³ Competitiveness Initiative. You can read the comment ASBN is sending and sign on to support it here.

You can read more about the Ag Census in the farm producer highlights and the farm economics highlights.

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