ERS Report Summary: Complex Changes in Farm Structure

In the last 25 years, U.S. crop farms have steadily declined in number and grown in average size, as production has shifted to larger operations. The census shows small and large farms increasing while number of middle sized farms decreasing. Small farms account for less than 2 percent of all U.S. farmland, large farms account for 67 percent. Larger farms tend to receive more commodity program payments because most payments are tied to a farm's current or historical production, but whether payments have contributed to farm growth is uncertain. This study uses farm-level data from the census of agriculture to determine whether there is a statistical relationship between farm commodity program payments and greater concentration in production. The analysis indicates that, at the regional level, higher commodity program payments per acre are associated with subsequent farm growth. Also, higher payments per acre are associated with higher rates of farm survival and growth. Reported in the November, 2007, Economic Research Service summary, the full report explains details on commodity payments, farm business survival, and farm size growth. Find the full report at www.ers.usda.gov/publications/err51