Extension@YourService: Future Farmers
Many of us take our food for granted. Maybe we know that mom/wife/husband will be providing us with a homemade dinner tonight, or that for a few bucks we can run through the drive-thru of the local fast food restaurant and have a meal. We take for granted that the grocery store will always be stocked with anything and everything we want to eat. But will this always be the case?
Every 5 years the US Department of Agriculture conducts a massive “Census of Agriculture”, collecting data on farmers and ranchers across the country, everything from crops produced, acres owned, gender and age of the farmer. The 2017 Census is still on-going. According to the 2012 census, the average age of farmers in North Carolina is 59 (58.9, to be precise), which is on par with the national average (58.3 years). One of the standout data trends from the census over decades, is with every five year survey, the average age of farmers continues to creep higher.
At some point, those farmers will retire or, sadly, meet their Maker while driving the tractor. Another handy, if ominous, statistic from the census shows the number of farmers declining from 2007 to 2012, a change of negative 4.3 percent.
Who will be growing our food in 20 years? It’s a real crisis that most of us are barely aware of.
Access to land is an essential element of farming. A study which parsed the 2012 USDA Ag Census data revealed that there are approximately 911 million acres of farmland in the lower 48 states. About 39% of that land is rented by farmers from the landowner. Fourty-five per cent of farmland is owned by small family farms which use most of the land they own (compared with larger farms, which have a mix of owned and rented land which they farm). Ten percent, or 93 million acres, is expected to be transferred between 2015 and 2019, as farmers retire or pass away. Only one-quarter, or about 21 million acres, is expected to be sold outside the family. This means it can be quite challenging for young or beginning farmers to buy land, as there is relatively little available. To make things even more difficult: a recent trend of farmland investment buyers is increasing competition for farmland purchases. Over the past 10 years or so, investors – who previously would rarely view farmland as a legitimate investment – now see it as a safe place to invest, providing income and dividends as land increases in value. As greybeards back in the day would say, “they ain’t making any more land”.
Access to land is one of the greatest challenges to farming. It’s no coincidence that many of the southern states, including North Carolina, have seen some of the steepest declines in the number of principal farm operators of less than 10 years (-21.2%), as development pressure has increased dramatically. Rising land values can impact the ability of a family to hold onto its land without proper planning. Farm and forestland is very often an asset that has been built up over generations. While there may or may not be a great deal of “liquid” wealth – cash money – land and equipment is a critical form of wealth, particularly in rural areas. As farmers and landowners age, it is increasingly important for them to have an estate plan which will allow them to maintain control over how their assets will be allocated at their passing. For example, there are legal instruments, such as Trusts, that can help families manage wealth distribution and enable protection of assets when a family member is disabled or unable to manage their own financial affairs.
There is a free workshop at the Richmond County Ag Services Center on Farm Transition Planning for farmers and landowners on Thursday, March 15, from 7-9 p.m. Specialists from NC State University will be providing a program addressing tax and estate planning designed specifically for farmers and landowners, with information which will provide a road map to building a personalized estate plan. Attendees will receive a workbook with exercises and guidance to begin planning, and how to communicate with other family members about the process. For those that attend the workshop, the presenters will be available at a later date for a one hour personal consultation.
This workshop is provided by Green Fields Sandhills, a non-profit with the mission to promote and support agriculture in the Sandhill’s, and funded by a grant from the Tobacco Trust Fund Commission. Workshops have been held in Moore and Lee Counties, and the last one is here in Richmond. By helping farmers and landowners develop a path for farm estate transition, working lands can continue to operate without undue disruption, loss of land or value, as land transitions from one generation to the next.
To register for the workshop, visit: gfsfarmtransitionplanningrichmond.eventbrite.com, or call the Richmond County Extension office at 910.997.8255.