Mid-sized farms getting squeezed out in northeast Indiana

It’s an industry with a shifting size range, according to the latest farm census data released by the U.S. Department of Agriculture.

The number of mid-sized farms, those that range from 180 to 499 acres, has shrunk dramatically over the last 25 years. In 1987, farm census data reported a combined 680 such farms in DeKalb, LaGrange, Noble and Steuben counties. In 2012, that number had shrunk to 318, a decrease of 53.2 percent.

“At that range, it’s not worthwhile to have that as their primary occupation,” said Elysia Rodgers, director of the DeKalb County Purdue Extension office. “A lot of farmers in DeKalb County are part-time. People are doing more jobs off the farm, but are still coming home in the evening to do their harvesting and planting.”

Noble County Extension educator Doug Keenan said it’s a struggle to support one family on such a small farm acreage today.

“It’s a lot harder to make that happen,” he said, “especially if you want to bring one of your children in.”

Some farmers don’t have children who want to farm, resulting in more loses of mid-sized farming operations, Keenan said.

“A lot of it was farmers retiring and their kids not coming back to farm,” he said.

As a general rule, the loss of mid-sized farms has led to a decrease in the number of people who can make ends meet as an agriculture producer.

The number of farm operators who listed farming as their primary operation also has decreased in that time span in northeastern Indiana, from 2,013 in 1987 to 1,972 in 2012, a dropoff of 2 percent. Toss out LaGrange County’s increase from 825 to 1,048, and DeKalb, Noble and Steuben counties saw a combined decrease of 22 percent.

Kevin Stoy, who partners with two of his brothers in an Ashley-based farm operation, said shrinking profit margins make it difficult for mid-sized farmers to make a go of it.

“You just need to have a lot of gross revenue to buy the things you need to be efficient and make a living,” Stoy said. “It takes a lot of capital to get to the point where you can make a reasonable profit per acre.”

Irrigating land, putting on more fertilizer and technology to make the planting-to-harvesting process efficient is expensive, he said. His operating costs per acre have quadrupled in 26 years, he estimated.

Stoy Farms owns 2,000 acres in northeastern Indiana, Ohio and Michigan. It rents another 12,000 acres.

The number of farming operations larger than 1,000 acres has jumped 39.4 percent from 1987-2012, according to the agriculture census.

A farm with a lot of acreage can survive on a smaller profit margin, while a smaller operation can’t, Stoy said.

The number of smaller farms continues to rise. Operations with between 1-49 acres increased 132 percent in the last quarter century in DeKalb, LaGrange, Noble and Steuben counties.

Thriving anyway

The number of people who depend on farming to support their families may be dwindling, but commodity price increases have led to unprecendented sales and production.

In 1987, northeastern Indiana farmers reported a combined market value of crops and livestock sold of $186 million. By 2007, that number had grown to $354 million. From 2007 to 2012, that number jumped another 62.3 percent.

In 2012, DeKalb, LaGrange, Noble and Steuben county farmers sold crops and livestock with a value of half a billion dollars.

According to Stoy, farmers are using every square inch of farmable acreage, and technology and techniques have increased yields.

Keenan pointed to GPS devices in tractors that can work with computers on the equipment to disperse fertilizer at variable rates in the same field.

“GPS has been very helpful to crop farming that way,” he said.

Land-use figures provided by the census show a dramatic drop in farmland acreage in northeastern Indiana. Census data show a combined loss of 58,000 acres in DeKalb, Noble and Steuben counties from 1987-2012.

But those numbers are misleading, according to Greg Matli, a statistician with the National Agricultural Statistical Survey who is based at Purdue University in West Lafayette.

“Nobody lets $5,000-per-acre land sit,” Stoy said. “We produce more on less every year. You have to be a better manager than you were 30 years ago.”

Rodgers said commodity prices have played a big impact in the increased revenue.

In 2007, corn could fetch between $3-$4 per bushel. Beans were in the $10-$12 range.

Since then, corn went through a period where it doubled in price, she said, and beans also experienced a 50 percent jump.

Land issues

Higher commodity prices have led to pressure on land prices, Stoy said. Large farms with better capital are driving the puchase of land, in effect squeezing out the mid-sized farmer in some cases.

Rodgers said in her county, there is the added pressure of urban sprawl as Fort Wayne’s population continues to expand northward. Throw in the added pressure from big farming operations to take over available land, and therein lies a reason that DeKalb is the only county in northeastern Indiana to see a drop in the number of people who listed farming as their primary occupation from 2007-2012.

There is also the impact of people who own farms selling off sections to take advantage of high prices and to help fund their own smaller operations.

The farm census lists statistics for cropland acreage and total farm acreage, but those numbers can be misleading, Matli said.

Matli illustrated that if a farmer with 1,000 acres in Elkhart County buys 500 acres in LaGrange County, that acreage will be counted toward Elkhart County’s total, since that is the county where the purchaser has the majority of his farming operation. A farmer who has his primary operation in Michigan and buys 500 acres in Steuben County will have that acreage total added to Michigan’s figures, not Indiana’s or Steuben County’s.

The Amish exception

LaGrange County’s farm statistics continue to grow. In 2007, LaGrange County led the area with $171 million in agriculture product sales. That figure moved to $262 million in 2012, an increase of 53 percent.

More people listed farming as their primary occupation in 2012 in LaGrange County (1,048) — an increase of 84.8 percent from 2007 numbers — than in DeKalb, Noble and Steuben counties combined (925).

The USDA counts every operation with at least $1,000 in sales as a farm. LaGrange County ranked No. 1 in the state with 2,419 farms in 2012.

Steve Engleking of the LaGrange County Extension office said the big push is tied to his county’s Amish population.

“The Amish in particular have subdivided their tracts to sell to their kids,” Engleking said. “I see that as the prime driver in this county.”

There is also an overall economic time-in, he said. When the recession hit in 2008, many Amish workers who had labored in recreational vehicle factories were laid off, as that industry was hit particularly hard.

“They had to do something to make ends meet,” Engleking said.

That something, in many cases, was returning to their agricultural roots.

Amish farmers have become adept at doing things such as creating mini-confined animal operations and greenhouses on small pieces of ground. Many of the operations are organic in nature, a trend that has allowed them to be profitable by selling to outside niche markets.

“I think the Amish have been very good at maximizing sales from a small acreage,” Engleking said.

The Amish also have maximized their sales by working cooperatively in many instances, including organizing a produce auction.

NonAmish farming operations also have moved into the organic farming industry. LaGrange County ranks No. 1 in the state in the number of organic farms, Engleking said.

For total farms, Indiana’s top seven counties have at least some sort of Amish influence or presence. Allen County ranked second in the state with 1,725 farms in 2012, followed by Elkhart (1,724), Adams (1,476), Daviess (1,325), Kosciusko (1,247) and Noble (1,163).

With the kind of success LaGrange County’s smaller operations have seen, Engleking said predicting the demise smaller farming operations isn’t locked in stone.

“As a general statement it’s false,” he said. “It’s dependent on enterprise selection and methodology.”

What the area always has going for it is convenient access to population centers such as Chicago, Detroit, Indianapolis and Cleveland, he said. Northeastern Indiana lies in the middle of all of those people, with the Indiana Toll Road and Interstate 69 as important factors.

“We’re within 2-3 hours of millions of people,” Engleking said. “We’ve got great infrastructure to move that product to those geographic centers.”