Percy Editorial Summer 2015

Summer 2015

By Alice Percy, MOFGA President
Treble Ridge Farm, Whitefield

I can’t count the number of times I’ve had this conversation.

Customer: So how big is your farm?

Me: Well, we try to grow out about 80 pigs each year, and we’re cropping between 80 and 100 acres.

Customer: That’s huge!

Actually, that’s not huge. It’s so small it can’t support our family, even though we run a profitable operation. If the Good Food Movement wants to change how the world eats, then we must get serious about our farms being environmentally AND economically sustainable – and that means changing the language we use when we talk about farm scale.

When people talk about Good Food, “big” is pejorative: “Big Ag” and “giant corporations,” or “small is beautiful.” We want farming to be decentralized, democratic and accessible. All legitimate concerns: So MOFGA and its allies often talk about “small-scale family farming” – emphasis on the word “small.”

This language ignores the breadth of scale in American agriculture. The USDA defines a farm as grossing at least $1,000 annually from agricultural sales – a threshold achievable with one dozen organic laying hens. This scale resonates with my customer who qualifies a farm as “small” only if he or she can imagine the operation in his or her backyard. In a state where fewer than 10 percent of farms gross over $100,000 (as opposed to 17 percent nationally), and our agricultural production accounts for just 0.2 percent of the national total, our perspective may be somewhat skewed. Our celebration of the small tends toward a worship of the micro, which challenges the livelihood of MOFGA’s farmers and limits MOFGA’s ability to shape the future of agriculture.

The USDA says a “small” farm grosses under $350,000. This sounds big, but it’s simple realism. It reflects the profit level a farmer might achieve with excellent management and savvy marketing and acknowledges that full-time farmers must support their families comfortably. According to the University of Minnesota, “… most farm businesses strive to keep operating expenses under 70 percent of gross revenues. If you are operating a small farm … you should probably strive to keep operating expenses below 60 percent of revenues.” Under its definition of operating expenses, the “profit” must cover not only household expenses but debt repayment and capital purchases. A term debt coverage ratio of 150 percent is considered healthy, so debt service could eat as much as 2/3 of that profit  – with no new investments.

So a farm couple with two children must gross at least $100,000 just to rise above federal poverty level. Only 25 percent of MOFGA-certified operations are grossing over $100,000. That family must gross at least $200,000 annually to have a chance at achieving Maine’s median household income. Only 13 percent of MOFGA-certified operations are grossing over $200,000. Let’s grow those numbers!

Today, 83 percent of American farms gross under $100,000. These farms account for just 8.2 percent of gross farm receipts. Meanwhile, 2 percent of American farms gross over $1 million and earn 51.6 percent of America’s gross farm income – and account for a greater proportion of U.S. food production, since the smaller farms are far more likely than the largest to earn higher prices in retail markets. To double the number of farms in the under $100,000 category, we must first find 1.8 million people who want to engage in a food production enterprise that is primarily a lifestyle choice, not a livelihood; if we succeed, we will chip off less than a quarter of the top 2 percent’s share of American agriculture.

Farms grossing $100,000 to $1 million, however, account for 15 percent of American farm operations and 40 percent of our gross farm receipts. If we doubled the farms in this category (300,000 new or bigger farmers), we could almost eliminate the need for the food giants. These mid-scale farms are small enough that a household can manage them. These are farms small enough to support the management- and labor-intensive techniques of truly organic agriculture: the techniques we need to use on a broad scale to protect our country’s soil, water and public health. Yet these are farms large enough to work with the distributors and processors that can bring organic food from family farms to the average American.

Before anyone fears I’m channeling the spirit of Earl Butz (Nixon and Ford’s Secretary of Agriculture, who coined the charming phrase “get big or get out”), let me clarify: There must be room on the land and in the market for farms of all scales, including the very small and the part-time. I’m not saying everyone’s aim in farming must be to earn his or her living, but that we must not look with distaste upon those who scale up their farm enough that earning a living is possible. Earl’s policies didn’t eliminate the smallest farms – rather, they decimated the mid-scale farms. Mr. Butz, we need our mid-scale farms back: The ability of the mid-scale farm to provide a household’s income is fundamental to the success of the organic model.

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