Large farms, with more than $1 million a year in gross income, nearly doubled their share of U.S. agricultural production in the past quarter-century, says USDA’s Economic Research Service. As production shifted to larger farms, so did crop subsidies and crop insurance indemnities, says the ERS, which made the comparison on inflation-adjusted revenue figures.
According to the ERS, large farms accounted for 41 percent of agricultural output in 2015, versus 23 percent in 1990. “Payments also shifted to farms with higher household incomes, mainly because larger farms tend to be operated by people with higher household incomes,” said USDA. “Insurance indemnity payments follow a similar trend but with more inter-year variability … Conservation program payments also shifted to higher income households, but more slowly.”
Congress has expanded the role of conservation and crop insurance over the past couple of decades, with the result that crop subsidies faded in significance. In 1999, commodity supports amounted to 89 percent of federal farm payments. In 2015, commodity subsidies were 43 percent of the total for crop subsidies, conservation programs and crop insurance. The 2014 farm law made crop insurance the largest farm support program.
To read the ERS report, “The evolving distribution of payments from commodity, conservation and federal crop insurance programs,” click here.