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In US Midwest, young farmers priced out of land
Ethanol demand has pushed Midwest farmland prices through the roof.
from the March 22, 2007 edition
Page 2 of 3
The issue is a concern to some because of the aging farmer population and the continuing trend of consolidation and depopulation of rural America that it contributes to. About half the nation's farms are owned by people over the age of 65, and a quarter are owned by people over 75, according to the most recent survey, which Duffy's organization conducted five years ago. He expects those numbers to rise significantly when they redo the survey this year.
As land passes down to a generation that may be farming it, more acres – currently about 1 out of every 5 – are owned by people who don't live there.
Some see that as the natural evolution of farming and a way to keep things efficient, but others worry that the barriers are getting too steep – and that America's rural culture will suffer a loss. Many, of course, celebrate the surging land price.
"It represents a huge wealth increase for those who own the land," says Bruce Johnson, an agricultural economist at the University of Nebraska in Lincoln. "It's the hottest real estate market to be in right now."
For those trying to enter it, Professor Johnson acknowledges, it's tough. Like Duffy, he encourages young farmers to find alternatives to owning land.
Niches with higher profit margins – like the organic market Miller hopes to enter – can also help.
Not all young farmers are discouraged. Kyle Maas, a senior at Iowa State University and the former chairman of the Beginning Farmers Network there, has already entered into a nonfamily partnership with an older farmer and his son. They're focusing on cattle, because it requires less land. They also grow some row crops and hay. The high rents are tough, he says, but he thinks the market is such that they can make the operation profitable.
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