—-Lancaster Farming, Saturday, Oct 23, 1976
64
What awaits ag grads?
Why shell out 8 to 15 grand
to be part of an industry
where firm numbers are
declining...where the little
guy has slim chances of
survivai...where profits are
about as unpredictable as
the weather?
Economists don’t claim to
have the answers. At best,
they can sketch the “most
likely” scenario for
agriculture, and let the Class
of 1980 decide for themselves
whether a degree in
agriculture is worth the
investment.
Much of the following
pertains to the farm sector,
but what happens there will
ripple to every shore of the
Nation’s food and fiber
system - to farm suppliers,
processors, marketers,
exporters and eventually to
the 224 million U.S. con
sumers who will be bidding
for the products and services
of agriculture in the early
1980’s.
First, some general
projections:
Demand for farm products
- for domestic use as well as
export - is expected to grow
by 1% to 1% per- cent an
nually over the next 5 to 10
years.
Farm output will mount 1
to 3 per cent a year
(depending on price and
weather conditions), thanks
to steady advances in
technology and the sub
stitution of capital for land
and labor.
Chronic surpluses or
shortages of farm products
are not in the picture,
although farm in come and
prices will fluctuate.
The farm count. No doubt,
relatively few members of
the Class of 1980 will go into
fanning. Those who do will
find themselves among the
elite: By 1980 we’ll have only
2.2 million farm units,
600,000 fewer than 1974 and
1.8 million fewer than in 1960.
In the 1960-74 period, farms
with less than 50 acres ac
counted for over half the
decline in numbers. Only
farms with 500 acres or more
showed increases. That’s not
to say the family farm is as
outmoded as the home-style
butter churn. Since 1949,
family farms have made up
95 per cent of all farms and
about 60 per cent of farm
sales (a family farm being
defined as one on which
hired workers provide less
than 1.5 man-years of work).
Family farms of today are
akin to the large-scale
production units. They’ve
become industrialized and
are closely tied to nonfarm
businesses. They - and other
fanners - depend on the rest
of the economy for 65 per
cent of their inputs, once
Dairy club meets
BAIR, Pa. - The Central
Dairy 4-H Club met on Oc
tober 11 at the 4-H Center,
here. Pledges were led by
Kevin Laughman and Roy
Thompson.
Carl Anderson, president,
presided over the meeting. A
committee was formed for
nominating officers for next
year. Kathy Rauhauser is
depreciation of farm
machines and equipment is
added.
Going commercial. Still,
there’s no denying that
commercial farming figures
big in the scenario for
agriculture. Today, 1 out of 6
of the largest farms con
tributes 70 cents out of every
dollar in cash receipts from
farming, and 60 cents of
realized net farm income.
Though farms wiith annual
sales of $lOO,OOO or more
represennt just 4 per cent of
all farms, they generate 47
per cent of the cash receipts
and a'little over one-third of
the net farm income.
Thafsordy a hint of what’s ' borrowers,
to come. ERS estimates that Commercial banks and
by 1980-85, farms with an- Production Credit
nual sales of $lOO,OOO-plus Associations (PCA’s) - which
may increase to 8 percent of are also part of the Farm
the total farm count (twice Credit System - provide the
today’s and bulk of fanners’ operating
may be generating nearly 60 funds,
per cent of all cash receipts Here are some other
vs. under 50 per cent right happenings envisioned for
now. agriculture:
Other signs of bigness. On
the dairy scene, herds of 100
or more will make up 7 per
cent' of all dairy cows by
number in 1985 but 30 per
cent in terms of output.
Farms will number 203,000
against 380,000 in recent
years.
On the hog scene, farmers
selling 200 or more hogs will
account for over 90 per cent
of sales. Less than 220,000
producers will provide them,
compared with 700,000 in
1973.
The average size of beef
cow herds will expand
rapidly in every region.
Growth will stem from
consolidation of farms and
ranches plus the ability to
use existing forages more
effectively as a result of
larger size.
Part-timers. For those of
the Class of 1980 who’d
rather not spend all their
-days in fanning, -there’s
always the option of part
time farming. Its im
portance will be increasing
in the years ahead. The
trends speak for themselves.
In 1930 we had fewer than 1
in 6 people engaged in far
ming on a part-time basis.
Today 2 out of 3 farm
families derive more than
half, their . income, from,
nonfarm sources. That
proportion will be even
higher by 1980 assuming
people continue to move
from the cities to the
country, and assuming in
dustries continue to move to
rural areas where wage
rates are cheaper.
As for the money it takes to
get into fanning, the Class of
1980 can expect some
problems, The pressure on
money markets won’t let up,
chairman with Roy
Thompson, Cindy Rutter,
Tom Welsh, and Kevin
Laughman serving on the
committee.
Slides on 1976 4-H activities
were shown by Mrs. Emilie
Welsh. The next meeting of
the club will be a planning
meeting in February.
nor will high interest rates.
One thing in the would-be
farmer’s favor, though, is
that the seller provides much
of the financing for buying
farmland.
Raising Capital. Another
alternative is the Farm
Credit System. Its Federal
Idnd banks can secure funds
from central money markets
that will meet operators’
demand for funds at, a
favorable level of interest.
Since paper offered by the
Federal land banks is con
sidered a very high quality
security, the interest rates
charged to farmers are
lower than for other
More and more farmland
will be leased or rented, as
opposed to separate
ownership. Lease or rental
now accounts for over 40 per
cent of all land being used for
fanning. High land values
and increased capital
requirements will give
further impetus to leasing
and rental of land and
equipment.
Corporation farming. The
trend toward corporate
ownership will gain
momentum. But, large
corporations won’t be in
volved in any great way.
Most of the new corporations
will be closely held - 10 or
less shareholders. Right now
the farms legally in
corporated account for 14
per cent of total farm output,
and again, most fall in the
closely held category. Ex
cept for legal form, nine
tenths of all corporate farms
are indistinguishable from
other farms controlled by
proprietors and part
nerships.
Incorporated or not, the
family farm will remain the
dominant form of American
agriculture in our lifetime. It
will continue to account for
about 90 per cent of all
farms. However, ihe family
farm of 1980 will be more
modern, sophisticated, and
commercially oriented.
Capital requirements for
agriculture will keep
escalating. Even with in
terest rates averaging 1.5
per cent higher than for 1975,
net borrowing will top $l2
billion in each of the next 4
years. Total debt out
standing on January 1, 1980,
may approach $175 billion, or
$35 billion higher than the
January 1, 1976 estimate.
Integration. There will be
tighter coordination of the
farm production, input, and
product market sectors in
the agribusiness complex.
Fanners will be integrating
both forward into their
markets and backward into
supply of inputs through
their cooperatives.
For many products with
unstable markets, we can
expect wider use of forward
contracts, futures market
contracts, and private crop
storage arrangements.
Instability may also en
courage greater diver
sification in crop and
livestock production.
Yet, large segments of
American agriculture will
not become part of a highly
integrated, industrialized
agribusiness systole Though
both cattle and hogs are
moving in this direction,
large-scale integration
seems unlikely in the next 5
or 10 years. Production of
grain andTnilk seems even
less likely to take on the
characteristics of an in
tegrated, industrial comples.
Whither productivity?
Further advances in farm
output await the Class of
1980. Agricultural output is
expected to grow about 1 per
cent a year, assuming public
research and extension
spending continues to in
crease at an annual average
of 3 per cent in real dollars.
Higher crop yields will
contribute the biggest share
of the increase. .Yield in
creases will come mainly
from more of the same
technology that boosted
yields in the last 25 years -
hybrid seed, more fertilizer,
improved machines,
narrower rows and higher
plant population per acre,
chemical weed control, and
"continuous eroping of high
yielding crops.
Also, our scientists are at
'Work on the less visible
sources of productivity
growth. Some of the
breakthroughs are quite
exotic: the enhancement of
photosynthetic efficiency,
greenhouse agriculture,
bioregulators to aid in«
harvesting and storing fruits
A fall cover crop makes so much sense. First, you
can prevent excessive erosion problems. Second,
you conserve valuable soil moisture. And third, you
have the option of planting No-Tillage next spring.
You simply burn off the fall cover crop with ORTHO
Paraquat CL herbicide and plant right into the stubble.
For best results, apply Paraquat with ORTHO X-77
Spreader. Why not come in for a chat.
P. L ROHRER & BRO., INC.
SMOKETOWN, PA
and vegetables, an
titranspirants to make
plants retain water, and
twinning in cattle and other
livestock.
It’s time
to plant a
cover crop
right now.
Ortho Chevron Chemical Company
PH: 717 299-2571
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