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Future elsewhere, farmers tell progeny

 
By MATEUSZ PERKOWSKI
Capital Press Staff Writer
June 29, 2007

As U.S. farmers grow older and it gets harder for the next generation to take their place,
family farms face an uncertain future, according to experts at a recent congressional hearing.

“The continuing decline in the number of farmers 34 years of age and younger has raised
concerns that an insufficient pool of new entrants will be able to replace a large and growing pool of retiring farmers,” said Charles Conner, deputy secretary of the USDA, in submitted testimony.

The hearing on aging in agriculture was called by Sen. Gordon Smith, R-Ore., to determine what factors have contributed to the demographic shift and how more young people could be recruited to the profession.

Inflation in land and equipment prices, as well as the increased cost of complying with
government regulations, creates obstacles for young people who want to enter the industry, Smith later told the Capital Press.

“The economics of agriculture have squeezed family farmers to the point where farmers
are telling their kids: The future is elsewhere,” said Smith.

The average U.S. farmer or rancher is nearly 56 years old — about 5 years older than the
average farmer 25 years ago, according to Conner. In terms of average operator age, farming outranks almost all other careers tracked by federal population surveys, he said.

Between census surveys in 1982 and 2002, the proportion of young farmers to older farmers declined precipitously, according to Conner’s testimony:

In 1982, about one in five U.S. farmers was under 35 years old, while one in seven was over 65. By 2002, the young farmers accounted for only one out of every 14 primary operators, while the ratio of older farmers climbed to one in four.

Although the aging farming population is not a new phenomenon, some of the contributing factors have accelerated in recent times, according to Conner’s testimony:

In the 2002 census, the average farm was valued at more than $700,000 in land and facilities.  Since then, the already high price of farmland jumped substantially — 21 percent in 2004, and another 15 percent in 2005.

“Thus, these figures indicate that access to capital for the purchase of land, buildings
and equipment may be a significant hurdle for many young farmers,” stated Conner.

To ease this burden, Smith supports several USDA recommendations for the 2007
Farm Bill:

■ Increasing direct payments to young farmers by 20 percent, which translates into
$250 million in additional farmer income over the next decade.

■ Setting aside one-tenth of conservation financial assistance for “beginning farmers
and socially disadvantaged producers” through a new Conservation Access Initiative program.

■ Reducing the Beginning Farmer and Rancher down-payment Loan Program’s interest
rate to 2 percent, about half of what it is now.

■ Replacing the maximum $200,000 limit on both operating and ownership loans with
a $500,000 maximum that allows any combination of the two loan types.

■ Lowering the minimum down-payment to 5 percent of the property price, down from
the current 10 percent.

“There are things government can do,” said Smith.

However, some government actions only add to the problem, according to submitted testimony from Barry Bushue, president of the Oregon Farm Bureau.

“Increasing and unnecessary regulations on the industry continue to force established
farmers and ranchers out of business,” he said in submitted testimony. “How is a young
person supposed to cope?”

Bushue also listed labor shortages and estate taxes as hardships that affect agricultural
livelihoods, and urged Congress to pass comprehensive immigration reform and
to permanently eliminate estate taxes on farm land.

“So much of what happens in Congress has a direct impact on the industry,” he said.

Mateusz Perkowski is based in Salem, Ore. His e-mail address is
mperkowski@capitalpress.com.
 
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