The Truth about Industrial Agriculture
Industrial agriculture is a term often used negatively, but is it the villain it’s made out to be?
The debate surrounding industrial agriculture and farm consolidation is complex and multifaceted. On one hand, industrial agriculture is criticized for contributing to the decline of small family farms and promoting unsustainable practices. On the other hand, it is highlighted for its efficiency and ability to meet the food demands of a growing population.
Understanding the dynamics of farm consolidation is crucial for all types of farmers, as it affects the entire agricultural landscape. The truth is that both small and large farm operations have an important role in our society, their own set of strengths and weaknesses, and misconceptions surrounding them.
Industrial Agriculture and the Relationship to Farm Consolidation
Industrial agriculture refers to a large-scale farming system that emphasizes high output and efficiency through modern technology and mechanization. The topic of farm consolidation is closely tied to this term, as one typically leads to more of the other. The greater the consolidation, the more “industrialized” our food system becomes.
Recently, this has become a more pressing topic of concern with the release of the 2022 Census of Agriculture. This census highlighted that, from 2017 to 2022, the number of U.S. farms decreased by nearly seven percent, falling below two million, and total farmland fell by two percent. But at the same time, the average size of farms has been steadily on the rise since 2007.
Source: 2022 USDA Census of Agriculture
Notably, the only category of farms that saw growth in 2022 was those with 5,000+ acres, with an increase of just over 1,600 farms. Large-scale farm operations own 42 percent of U.S. farmland and account for a majority of our food production. In fact, the total production value of the U.S. farming sector was $543.1 billion in 2022. Despite representing less than six percent of farm operations, farms with at least $1 million in sales accounted for 78.3 percent of this production value.
Source: 2022 USDA Census of Agriculture
Industrial Agriculture: The Good, the Bad, and the Misunderstood
The trend toward larger farms raises the question of whether industrial agriculture is replacing the small American farm. Small family farms have the advantage of maintaining local biodiversity, preserving traditional farming practices, and contributing to local economies. However, they often struggle with lower economies of scale and rely on off-farm income to remain financially stable.
Large-scale farms, also referred to as industrial farms, achieve higher productivity and efficiency, meeting the food demands of a growing population. And with the global population continuing to grow, the demand for food is higher than ever. Industrial agriculture plays a critical role in increasing productivity to meet this demand.
Unless a lot more people suddenly decide to start farming, larger farms equipped with modern technology and efficient practices are essential for producing the volume of food required to feed billions of people.
Partner with a Lender Who is Dedicated to Your Farm’s Success
At AgAmerica, we are committed to supporting American agriculture in all its forms. With less than two percent of the population farming, we can’t afford to lose more farmers. That’s why we take the time to learn the unique strengths of your operation in order to help you effectively offset any potential weakness. We’re on a mission to provide farmers across the nation with the financial resources and counsel necessary to keep them thriving for generations to come.
We believe in the future of American agriculture because we’re a part of that future. Learn more about our flexible financing solutions that can be customized to support your diverse needs.
