What nobody told me about small farming: I can’t make a living

http://www.salon.com/2016/01/01/what_nobody_told_me_about_small_farming_i_cant_make_a_living_2/

by SwellJoe • 11 years ago

49 99 11 years ago

salon.com

PaulHoule• 11 years ago

I don't think you talked to too many people.

a2tech• 11 years ago

My grandfather ran a farm. Small farming isn't profitable. Full stop. Farming scales up really well but not down.

greggarious• 11 years ago

And if you can make back the costs of the equipment, own the land, and create enough food for your family, what value does money have?

CountSessine6• 11 years ago

Was that something that the article author managed to do?

TeMPOraL9• 11 years ago

Participating in the rest of human civilization?

rdancer• 11 years ago

It's good while it lasts, but being a subsistence farmer has its downsides. Once you get a few bad years in a row, or the government decides that farmers don't really matter so eff them, you will appreciate the profits you've put away during the fat years.

Fomite• 11 years ago

The ability to occasionally do something besides farming? Send your kids to college?

mitchty• 11 years ago

I grew up on a farm/ranch. We had about 5000 acres of land, split 3/2 pasture/fields.

Even that was barely break even with 14 hour days in the summers. Equipment upkeep and maintenance is the worst.

TulliusCicero• 11 years ago

Duh. Do these people just forget about the principle of economies of scale? How do they think they can possibly compete against huge factory farms? I can understand if you're doing a small farm 'for fun', but don't understand how an otherwise intelligent person can think they can (or should be able to) make good money from it.

As the average age of the American farmer neared 65, I knew young farmers were badly needed in this country.

If they're truly in demand, one would expect wages or profits to signal that.

none of these things address the policies that dictate how our country’s food system works, policies that have created a society in which the small farmer can’t even earn a living.

Some of the policies might not help, but the fundamental reason small farms can't compete is that farming has large economies of scale. Some people may be able to find a niche charging high prices for uncommon goods, but that's never going to be the bulk of the industry. Expecting small farms to be profitable in that way is like expecting cobblers to make a comeback.

SwellJoe9• 11 years ago

I think the danger in our agricultural policy is that large farms are favored (through subsidies, tax breaks, regulation, etc.) to an extent that small farms can't exist profitably, even charging higher prices at market. While there is a minimum viable farm size (given the need for modern machinery to automate the process), most likely, it probably isn't nearly as large as what our current set of incentives enforces. And, historically, there were farming coops that made it possible for communities of farmers to share expenses for those tools (and some states and communities still have legal infrastructure and such to enable those kinds of organizations), but federal policy and mega-store purchasing policy makes it a moot point.

There's a lot more to the story of what our agricultural system looks like, and this article only touches on it from one personal, anecdotal, perspective, but it's simplistic to dismiss this perspective and the concerns it raises about our food supply. Michael Pollan has been writing compellingly on the subject for many years, and I recommend you check out The Omnivore's Dilemma and In Defense of Food. They provide a well-research view of why things are so skewed in our food system, and why that is dangerous to our current and future health.

"If they're truly in demand, one would expect wages or profits to signal that."

On that point, we're agreed...there has to be a way to correct the incentives so that a competitive agriculture market can exist, given the fact that we all need to eat, and ethically speaking, it'd be good if the most affordable foods were among the most healthy and least damaging to the environment. That's not the way things are incentivized currently. As it stands, there's a strong cartel of very large farms and animal agriculture companies that stack the deck in their favor. It isn't merely a story of efficiency of scale, it also includes lobbying, anti-competitive practices, etc.

rahimnathwani• 11 years ago

"large farms are favored (through subsidies, tax breaks, regulation, etc.)"

Can you share any examples of these things that specifically favour large farms? The two books you mention seem to be focused mainly on different issues (corn subsidies, large scale feeding, food labelling, ethics, ...).

TeMPOraL9• 11 years ago

I don't think that small-scale farming can regain its position of a significant contributor to the food production. And even if it could, I'm not sure that it should.

Food production scales up nicely, and it has many other potential benefits than just being cheaper. Say we fixed incentives that promote low-quality food (we have to do it either way, since small farmers are as much incentivized to sell crap as big ones; a big part of "organic food" industry seems to be about that). The big AgriCorp, if incentivized to make good food, can actually care about it better. They have more money to get top-of-the-line tools, or build their own. They can use them more efficiently. They have enough resources to monitor and control the farm in much greater detail. They have more expertise on hands. Am I seriously supposed to trust a Joe Random Farmer more than a professional biotechnologist or agriculturist from Monsanto or DuPont? If so, why bother with this whole thing called "science" at all?

It seems to me that the work needed to restore the quality of our food makes big farms an even better option than they're now. The issues are, ultimately, with economic incentives that promote everything but health aspects of food.

CountSessine6• 11 years ago

through subsidies, tax breaks, regulation, etc

I'm genuinely curious whether this is actually the case. Can you cite some examples? My google-skills don't seem to be adequate.

tptacek8• 11 years ago

Can you provide more support for the argument that "mega-store purchasing policies" make farm co-ops a "moot point"? It looks like even Whole Foods, one of the largest mega-suppliers of produce in the US, readily sources from co-ops.

A bigger possible reason farms tend not to join co-ops is that they integrate vertically and do direct marketing both to chains like WF and to farmers markets and, particularly, restaurants. For vegetables, there are a lot of farms like this in the Midwest.

Obviously, if you're growing soy or corn or wheat, it's a different story. But I think nobody is particularly surprised that you can't readily make a living selling crops that are standardized and bid on in commodities exchanges.

wglb• 11 years ago

Having grown up on a dry land wheat farm, a farm that had subsidies along with everyone else, I think your argument that large farms are favored is flawed.

From the time that my grandfather homesteaded in 1911, productivity of all farms, large and small, increased by almost two orders of magnitude over the next 50 years. Increases in technology, including mechanical, chemical, and electrical drove the price of wheat and other crops down.

So it is simply a matter of scale. It should surprise no one on hn. For me, my parents saw the writing on the wall and sent me off to engineering school. There is some romance associated with "going back to the land" but you know we haven't been there all that long.

What I wonder, in the sense of sustainability, if the ecology of the earth will be able to withstand the savage damage caused by agriculture.

asuffield3• 11 years ago

How do they think they can possibly compete against huge factory farms?

As with so many of these things, there's this idea floating around that the factory farms must be "bad" because they are big and wealthy, and that smaller, less efficient farms must be "good" because they are small and poor. Much like with all the other cases, this idea is somewhere between confused and blatant denial of reality.

Money is the unit of caring. The amount of money that you're willing to spend on something is how much you care about having it, as precisely defined by the point at which it's too expensive and you don't care enough to pay that much. The factory farms are big and wealthy because they provide what people care about: an efficiently produced, consistent solution to the problem of what to have for dinner.

If people really cared about their food coming from small, inefficient, "organic" farms then they would pay for what it really costs to produce food in that manner. The fact that people aren't willing to pay for it tells us that they don't actually care as much as they claimed. This is normal: most people will tell you they care deeply about something up until the point when you ask them to open their wallet, and then they remember that they don't care all that much.

It seems to me that what's really wanted here is better factory farms with modest adjustments to reduce pollution, antibiotics use, and improve animal welfare. That's entirely achievable. It won't be achieved by things like this article; it'll be achieved by somebody who sets out to make a better factory farm and builds a business around that.

This is already happening. http://spread.co.jp/en/ plan to have what could be a game-changing approach to vegetable farming up and running in 2017. Whoever gets that system to work well enough at scale seems likely to sweep the 1990s-style farms off the map. It's the exact opposite direction from what the "organic" farmers have been doing: no low-wage labour, no battles over land, no getting caught up in politics.

The next couple of years will be an interesting time for the food markets.

detaro2• 11 years ago

If people really cared about their food coming from small, inefficient, "organic" farms then they would pay for what it really costs to produce food in that manner. The fact that people aren't willing to pay for it tells us that they don't actually care as much as they claimed. This is normal: most people will tell you they care deeply about something up until the point when you ask them to open their wallet, and then they remember that they don't care all that much.

That's something I felt was missing from the article: No talk about their pricing. People pay (or not pay) the price they are asked to pay, not the price the thing costs to make (and have no idea how high that is).

Probably doesn't compare to the typical software-freelancer stories of "You should try to charge more than you think, clients pay that!", but it still would be interesting.

crdoconnor4• 11 years ago

If people really cared about their food coming from small, inefficient, "organic" farms then they would pay for what it really costs to produce food in that manner. The fact that people aren't willing to pay for it tells us that they don't actually care as much as they claimed. This is normal: most people will tell you they care deeply about something up until the point when you ask them to open their wallet, and then they remember that they don't care all that much.

Logically speaking either this is bullshit or everybody who has ever said that they are struggling to give up smoking is lying.

vacri3• 11 years ago

The fact that people aren't willing to pay for it tells us that they don't actually care as much as they claimed.

Or that they don't know. Supermarkets don't usually label their vegetables "BigCo" and "littleco". The problem with the 'market solves everything' approach is that it requires perfect knowledge on behalf of all parties.

tie_• 11 years ago

Thank you, sir, for the awesome comment!

digler9993• 11 years ago

They forgot economy of scale, but they also forgot to buy US subsidized crop insurance [1] to get a piece of the $14bn government handouts paid in a single year to big agriculture.

Their biggest mistake was trying to earn money honestly without sucking the teat of the corporate-welfare bandwagon.

[1] http://www.bloomberg.com/news/articles/2013-09-09/farmers-bo...

grogenaut• 11 years ago

I worked on a crop insurance app for a while. Big insurance co's greatest frustration is that farmers could basically just sign up and be guaranteed not to take a loss due to anything except their own purposeful damage (even market price below a certain value). And it would cost them nothing. Only the smart farmers did. The rest were fearful they were going to get swindled.

The smart ones used it like a hedge fund where they guaranteed a profit and were mainly betting profit rates on how much supply there was going to be.

Insurance company was providing it at a very low cost as the govt sets the service charge over the coverage level. Insurance companies have to compete on how cheap they can make the offering to actually provide (good cheap IT, good cheap claims). Big insurance co I worked with did it just as part of their portfolio to make it easier to sell insurance on equipment and life insurance.

Really odd setup but made sense as an alternate way to do farm subsidies if you thought about it. But farm subsidies pay you not to grow, this pays you to grow and guarantees a certain income if you control your other costs (maintenance, overhead, etc).

crdoconnor4• 11 years ago

If they're truly in demand, one would expect wages or profits to signal that.

Unless tax breaks lobbied for by the large agricultural conglomerates distorted the market.

briandear3• 11 years ago

The author of the article is your typical naïve liberal. They seriously chose to effectively be a sharecropper in Northern California? Had they actually spent any time on real working farms before they decided to jump in? The irony is that these types of people look down upon the 'rednecks' of flyover country and have the audacity to think that ten measly acres is going to support two people in Northern California. They have this dream of 'organic' agriculture while implicitly criticizing non organic farming. These people don't really know the first thing about farming -- obviously. If they did, they would have had at least the common sense to do the math.

For the two to make a small (by Northern CA standards,) salary of $80k per year that would mean they'd have to get a profit of $8000 per acre.

Carrots yield about 19,000 pounds per acre grown conventionally. Organic yields are less but the higher prices roughly offset the differential. NorCal wholesaler prices are at most .32 per pound for carrots sold in 50 pound boxes. (San Fran wholesale market price as of Dec 31.)

That's about $6000 yearly income (using carrots as a representative crop) per acre. That's $60k gross. That's assuming maximal efficiency which, given the obvious inexperience of these 'farmers,' would be irrationally optimistic to expect.

So now you're looking at a maximum of $60k gross for two people on ten acres. Even assuming they had zero overhead, that's $30k per year per person. They aren't picking ten acres of crops by themselves. They have to pay some help. They also don't plow the fields with shovels, so they have to have equipment, fuel, etc. So their profit is pretty much poverty wage. They don't apparently understand that 1 tractor can plow 100 acres and that same tractor could plow 10 acres. Economies of scale! That isn't some Monsanto conspiracy, it's just a fact of business. One they choose to ignore.

Are these people just stupid? Unless your ten acres are in Napa and you're growing grapes, you aren't making a living from renting 10 acres and growing beets.

The implicitly argument is that something ought to be done about this unfairness of how economics don't treat the 10 acre farmer very well. However, as a consumer, that isn't my problem. I don't care if a carrot has a parchment birth certificate and a pedigree or if it's just a carrot grown on a super farm somewhere. I don't have a responsibility to subsidize vanity farmers. I didn't make them rent land and try to grow stuff. They obviously don't think through the economics before they pulled the trigger -- I'm not feeling sorry for them at all. The interesting thing is that they blame the factory farms and the 'lack of a living wage' for their failure. While these same exact people are unopposed to illegal immigration which is the primary source of labor for these farms they abhor!

Am I assuming their politics? Yes, obviously.. But anyone who read the article knows these are the kind of people that would vote for anyone but the most liberal candidates on the ballot; the same liberals that want to increase the very immigration that results in the inexpensive labor that ultimately is putting them out of business.

gozur882• 11 years ago

We don’t have a lot of small family farms anymore for the same reason that we don’t have a lot of small family steel mills or utility companies: because it is a form of economic organization that doesn’t make a damned bit of sense. The next time I’m at some winger conference, Annette Kirk may very well punch me in the ear in memory of her late husband, but: Good riddance. Small-scale farming is the worst way of making a living known to mankind, and, given a choice, people will choose almost anything else. Do-gooders who can’t understand why people from rural India are lined up around the block for jobs in those purportedly horrible “sweat shops” and call centers and the like never ask themselves: What’s their next-best option? It’s hustling millet.

http://www.nationalreview.com/corner/425146/or-my-people-say...

chasing• 11 years ago

"That quirky lifestyle business I got into without really knowing much about? For some reason it didn't wind up being a gold mine."

vermontdevil3• 11 years ago

10 acres is not enough. A friend of mine owns 200 acres in Iowa and he has to work off-season to ensure a steady income. But the 200 generated enough $ for him to retire. Wasn't easy though.

peter3032• 11 years ago

Do you mean by selling the land? The last few years until this year there was boom in farmland prices.

vermontdevil3• 11 years ago

No still owns it. Rents it out now. But the ups and downs of income from farming made him work two jobs. Some years the crops brought in good money. Some years nothing. He managed to saved enough so he can retire.

But he told me he thinks 200 acres is the bare minimum to see some money if you are smart about it. The more acres the better obviously. And the farmer in the article only has 10???

peter3032• 11 years ago

I live in Colorado. Lots of profitable small farms here. You just need the right crop :-)

SwellJoe9• 11 years ago

I suspect that is temporary. The bureaucracy is already very large in the pot industry, and will grow with time...the big players will guarantee regulators stack the deck in their favor. As legalization spreads across the country, growing will be concentrated in a few areas where it grows most easily and with the cheapest labor and most favorable legal climate (just as tobacco is concentrated in a few places). The big players may be new ones, but agricultural history in the US indicates the small players will get pushed out as the market matures.

unabridged• 11 years ago

I think the marijuana industry will more resemble the wine industry. Large bulk producers will cover the cheap end of the market but there will still be many highly respected small players.

shalmanese• 11 years ago

The bottom is going to drop out of the MJ market very soon. Doing the math, you can supply the entire US on a single farm around 10,000 acres (+ or - an order of magnitude) because of how little of it you need to have an effect. Now that the artificial barriers of illegalization have stopped propping up the price, you're going to see drastic, orders of magnitudes drops in prices. Even under the most generous taxation and regulation assumptions, the price of the MJ will end up costing about the same as the rolling paper used to roll it at equilibrium.

tcskeptic• 11 years ago

Has the American small farmer ever been able to make a living?

jacquesm• 11 years ago

Small time farmers in NL have cash crops growing in their attics. It is quite amazing how many people will consider doing something illegal if it makes enough money.

Even people you'd never expect it of suddenly become experts in photosynthesis and hydroponics. Who'd have known that so many people discovered that they had green fingers after all when they can't distinguish a weed from a crop plant under other conditions.

TeMPOraL9• 11 years ago

I suppose they're also about to become experts in thermal insulation and waste heat management, given that some people got busted when their roofs suddenly become the only ones in the neighborhood that didn't accumulate snow in winter.

WJW• 11 years ago

Only because it's still illegal to grow it legitimately. How many of those small time farmers will keep doing it (for the money) when the government finally gives out some licenses to farm it commercially and the bulk marihuana price becomes a hundred to a thousand times lower?

CapitalistCartr• 11 years ago

My parents were small farmers. It is hard, hard work. They succeeded by focusing carefully on areas that weren't being served by the Agri-biz corporates. They chose several different specialties and worked them each hard to make a modest living. What I learned from it was to stay away from farming as anything more than a hobby.

snydly• 11 years ago

My great grandparents had a small farm in Massachusetts between the 30's-50's. They had 8 kids (free labor for ~20 years). They did well enough to send all their kids to college, but not much beyond that.

Something tells me you can do okay with a small farm if you're a poor German immigrant who fought in WWI because you're not expecting much anyway. Happy to not be starving. The woman in the article should've expected less from the beginning. They can chalk it up as a learning experience, I guess.

warmcat• 11 years ago

Small farmers are always just on the edge of poverty. I know this first hand since my parents own a farm (~3 acres and not in the US) and don't generate enough revenue to even get to a point of breaking even. The equipment, water, fertilizers, pesticides always have to be paid for regardless of whether you get a good crop or not. Add nature's whim on top of that too and you will see why small farmers are disappearing from the map.

mikestew• 11 years ago

Ten acres? Has anyone ever made a living off ten acres? Where I come from (Midwestern U. S.), that's a hobby farm.

And that assumes the person running the place is even a decent business person. Some won't succeed whether they own ten acres or a nail salon.

bryanlarsen• 11 years ago

Ten acres is just a big garden, not a farm.

analog31• 11 years ago

...we gained no equity because we didn’t own the land...

Farming on rented land seems like the original Uber. You're workers, with no guarantee of even minimum wage.

A couple of friends in the restaurant business have told me: Never open a restaurant if you don't own the building.

sjtgraham• 11 years ago

Feudal serfdom is the original Uber.

TeMPOraL9• 11 years ago

Everything seems to run in circles, some apparently greater than others.

marshray• 11 years ago

I remember a great sandwich shop (Sadlack's in Chapel Hill if anyone remembers).

The building owners kicked them out and opened a similarly-themed restaurant with a very very similar menu. Even the names of the sandwiches were heavily derivative.

bachmeier• 11 years ago

To quote Jerry Seinfeld, "I didn't know it was possible to not know that."

TeMPOraL9• 11 years ago

Yeah. She actually references the national statistics in her article; I'm surprised that apparently neither she nor her partner checked them out before starting the farm.

zekevermillion• 11 years ago

Hobby farming can make sense if you want to own a lot of land as an investment. If you don't farm it, in most states it gets assessed at a much higher residential rate for tax purposes. So it pays to farm, even if the business is break-even.

tptacek8• 11 years ago

10 acres is microscopic. The average small family farm is over 220 acres.

tptacek8• 11 years ago

Further into the article:

According to USDA data from 2012, intermediate-size farms like mine, which gross more than $10,000 but less than $250,000, obtain only 10 percent of their household income from the farm, and 90 percent from an off-farm source.

The words "like mine" here are misleading, because this farm is nothing at all like the farms the author is referring to. For one thing, virtually all the farms the author is comparing itself to are an order of magnitude bigger. But then:

One day late into my second season owning the farm, a customer walked in while I stood behind the counter spraying down bins of muddy carrots. The man asked how things were going. Financially, I mean. He held a head of lettuce in the crook of his arm, a bundle of pink radishes dangled from his hand.

Most small family farms are not walk-up retail operations; they work through distributors and co-ops.

Modern farming is also intensely technical. There was a time in American history where you could make a living as a wheelwright, too. It's not an outrage that you need to be a major corporation to build vehicles today.

TeMPOraL9• 11 years ago

I just got bitten by not having an ad blocker installed on the current browser.

You know what this[0] looks like? That nice "You may also like" box? Like a fucking end of the article. Except it isn't. It's only a half of it. Seriously, fuck you Salon. I guess you don't care if people actually read the stuff you post.

EDIT Oh, I know why it tricked me. Because the rest of the article only loads when you scroll past that ad. What the fuck.

[0] http://imgur.com/SMBtRkO

detaro2• 11 years ago

WTF. I wondered why the article ended so suddenly...

vonnik• 11 years ago

It's probably good to remind people yearning for the simple life that you can't make a living on most small farms, but it's not really surprising. The Green Revolution made it easy for a few people to feed a lot of people, fundamentally altering the ratio of farmers to consumers.

https://www.wikiwand.com/en/Green_Revolution

And despite concerns about food security, the US has consistently used agriculture as a bargaining chip in its trade agreements and foreign policy, opening our markets to countries that can produce food more cheaply than US operations can. Reagan, Hollywood's rhinestone cowboy, did a lot to destroy cattle ranching in the US by opening the market up to Canadian beef. Same dynamic.

Small farmers will only make money by focusing on cash crops that are organic, local, and other adjectives that Whole Foods customers are willing to pay for...

tejohnso• 11 years ago

Six thousand pounds of food on a tenth of an acre bringing in $20,000/yr. How's that for scaling down?

http://urbanhomestead.org/urban-homestead

angelo• 11 years ago

How have you heard of the Dervaes? Are you local to the area?

knughit3• 11 years ago

Ate you saying that $20k/year is a good living? For how many people? You can't even get family health insurance for that.

mysterypie2• 11 years ago

The typical family farmer in the U.S. is a millionaire because of assets. They have poor earnings and they whine a lot, but they are sitting on top of land, tractors, and buildings worth millions.

The average U.S. farmer could cash out, buy a house in Miami, and never work a day again in their lives. But they don't do so. They apparently like the country lifestyle and continue their struggle even though they don't have to.

Obviously the couple in the Salon article can't cash out and retire because they don't own their own land, and it's just a sliver of land at that.

knughit3• 11 years ago

Is that true? They don't have mortgages?

mysterypie2• 11 years ago

The average farm family has owned it for generations. The Salon couple is atypical in that they got into the business rather than inheriting it.

biggestbob• 11 years ago

Is this the USA problem or do small farmer have same problem in other country too? If all world has same problem it is very sad.

contingencies• 11 years ago

If these people are looking to make money, then they need to either lower their expenses or up their prices.

On the former side, there are very well documented examples of commercial success from organic farming using naturally focused practices instead of the fertilizer and weeding processes common to traditional western-style farms. A good point to start reading there is the Japanese microbiologist that popularized the approach - https://en.wikipedia.org/wiki/Masanobu_Fukuoka

On the output side, direct supply deals with restaurants or consumers in higher income areas (ie. possibly not local, but a large city nearby ... SF comes to mind) could be an excellent way to get higher return on individual crops by volume. Yes, this would necessitate a drive. But they probably do it now and then anyway, and it might just pay for itself. As a bonus, the article mentioned that the author's husband was a woodworker: knocking together some rustic wooden crates for deliveries to look the part is not something difficult at scale.

As a bonus, these type of delivery deals can be worded "by the crate" and "in-season", allowing more reliable distribution of crops and releasing pressure to grow things on the edge of or out of their natural season, which can necessitate higher investment, time inputs and risk on a per-crop basis.

I firmly believe that being relatively close to SF, it must be possible to distribute organic crops and make money. The author simply hasn't figured out a working model yet.

wooooo• 11 years ago

In addition to not doing their research, this is a great example of how destructive the west coast "fake it 'til you make it" attitude can be. Not only are they missing out on numerous opportunities by not being more honest with their neighbors (local farmers giving advice, neighbors patronizing them more if they know they aren't doing well and really do need their business, someone who knows a guy who runs a restaurant getting them a supplier deal, etc), I'm sure the stress and senseless alienation they suffer from "living a lie" isn't healthy either.

What nobody told me about small farming: I can’t make a living

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