Last year, 96% of all farms across the U.S. were family-owned. Those businesses produced 83% of our country’s agricultural output.
These numbers are according to a recent report by USDA’s Economic Research Service (ERS), America’s Farms and Ranches at a Glance. It further identifies that small family farms — defined as those with a gross cash farm income of less than $350,000 per year — make up 86% of all U.S. farms. They also operate on 41% of the country’s farmland. That’s down just slightly from 2022, when small family farms made up 87% of the farms and worked 44% of U.S. ag land.
The “small family farm” designation accounts for operators who report having retired from farming but remain working on a small scale and those who describe their primary occupation as one other than farming, in addition to producers who farm as their primary occupation. About 40% of the more than 1.6 million small family farms describe their business as in addition to an off-farm job, while nearly 36% report it as their primary occupation.
Just 4% of family farms were classified as large-scale, which means they have a gross cash farm income of over $1 million. Still, those businesses generated nearly half (48%) of the total value of U.S. agricultural products last year. They farm about 31% of the country’s ag land.
The remaining 4% of U.S. farms that are not owned by families varied widely in size, income, and ownership structure, the report states. The share of agricultural value produced by these businesses climbed from 2022 to reach 17% of the U.S. total. The majority (93%) of that production came from large-scale farms, but only 16% of nonfamily farms fall into that category.
The dairy picture
Dairy was the sector where large-scale family farms produced the highest percentage of total commodity value, with 77% of dairy’s value coming from these operations. Large-scale family farms also made up the most value for cotton (71%), specialty crops (59%), and cash grains and soybeans (52%).
Small family dairies contributed 4% of dairy’s total product value, the lowest share among the commodities identified. Additionally, 9% of dairy value came from mid-size family farms (with a gross cash farm income between $350,000 and $1 million), and 10% was produced by nonfamily farms.
Small family farms contributed the most value in the poultry and eggs sector (46%) and hay production (45%). Those were the only two commodities where large-scale family farms did not contribute the most value of production. The report clarified that poultry and egg farms are often considered small because most production is done under contract, and the farmer’s gross cash farm income only includes the contractor’s fee, not the value of their products.
Off-farm income supports the majority
Last year was an above average year for net cash income in agriculture. However, operating profit margin can vary widely between operations of different sizes. Larger farms rely less on off-farm sources for income.
Still, 85% of U.S. farm households earned more than half of their income from off-farm sources in 2023. When including farm and off-farm income, the median farm household income exceeded that of all U.S. households but was lower that the median income of households with self-employment. The report noted that about 42% of farm households had income below the U.S. median, and 51% had negative income from farming.
