The decline in medium-size farms ripples into the aisles of natural retailers

The squeeze on medium-sized farmers shown by the most recent U.S. Department of Agriculture is likely to reverberate into the aisles and food selections of the nation's natural products retailers.

A  report issued last Wednesday by the U.S. Department of Agriculture’s Economic Research Service (ERS) offered some sobering news for anyone in the organic and natural food business.

In the 15 years since seeds genetically engineered to resist herbicides were commercially released, GMO crops have swamped the agricultural production landscape. According to the ERS report, Roundup-Ready and other herbicide tolerant varieties now account for 93 percent of the soybean acreage and 85 percent of the corn acreage in the United States. That means that the overwhelming majority of acres in the United States are now being farmed in a manner that fosters the use of more—not less—chemical pesticides.

Sobering indeed. But not particularly surprising. Especially for those of us who read through another report issued by USDA last month.

On February 20th, USDA began dribbling out the first bits of information from the 2012 Census of Agriculture, the latest in a twice-decade barometer of farming and ranching in the United States. At first glance, the structure of agriculture appears to have remained relatively stable in the decade between 2002 and 2012, with the overall number of farms dropping by less than 1 percent. But the number of farms producing more than $1 million annually in crops and livestock expanded rapidly. In fact, the 82,000 farms generating more than $1 million in annual sales in 2012 is triple the number of farms in that category 10 years earlier. Meanwhile, the number of farms producing less than $1 million in annual crops and livestock fell by 74,000.  

While there has been some shrinkage in the number of farms selling less than $50,000 in products annually, the heaviest bleeding is occurring among mid-size farms, the sector that some call “Ag in the Middle”.

Large farms rely on industrial-style practices to produce the enormous volumes of raw commodities utilized in the conventional food business. Small farms are the cornerstone of direct marketing ventures like farmers’ markets. The shrinking number of medium size farms presents a real challenge for companies looking to supply the market with certified organic and other non-GMO packaged goods. Likewise, the erosion of mid-size farms is making it difficult for livestock producers to source organic and non-GMO feedstocks for poultry, pork and beef.

Consumer demand can help reverse this trend by creating a stronger economic incentive for farmers to disconnect from GMOs. Those economic incentives are perhaps the best hope for reclaiming Ag in the Middle.

But the consumer demand must also include a heavy dose of patience. Just as the number of mid-size farms has declined, so, too, has the basic infrastructure that serves that sector of agriculture. Mid-size farmers today have fewer small grain elevators, auction barns, and implement dealers to meet the needs of their businesses.

The recent growing demand for products produced without GMOs, even if they are not certified organic, may provide important incentive to restore that infrastructure, and to revive mid-size farming.

Only time will tell.

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