Farming consolidation worries ag industry leaders

Yahoo

19-03-2025

Federal data illustrating recent consolidation of California farming has raised concern in the industry about Sacramento's approach to regulation and the future of ag production in the state.
Industry leaders are pointing to U.S. Department of Agriculture figures that show the number of farms in California fell 10% between 2017 and 2022, while the average size of those farms increased by about the same proportion. Both trends were seen nationally during the same period but not to such an extent.
President Shannon Douglass of the California Farm Bureau Federation said the numbers are not surprising given how hard it is to do business in the state as compared with other farming regions around the world. She voiced particular concern about water availability and how costs disproportionately hit small farmers.
The head of the Kern County Farm Bureau, Jenny Holtermann, added that consolidation is always a concern as farmers shrink their farmland holdings or sell out altogether. She said implementation of California's Sustainable Groundwater Management Act, designed to bring pumping of underground aquifers into balance, is likely to leave some farmers unable to produce food.
"With increasing regulations, SGMA and the costs of inputs rising, farmers can only stay afloat for so long," she said by email Tuesday.
"We need our elected officials and policymakers to start to address our over-regulation and how they are pushing business out of California," she added. "Agriculture is vital to California and our food security for our country."
The USDA data doesn't just shine a light on consolidations between 2017 and 2022, the most recent year for which figures are available. It also provides insights on the industry's mixed profitability.
It shows the number of farms in the state reporting a profit dropped significantly during that five-year period but that those who reported a net gain made much more money than before.
Additionally, the numbers demonstrated that fewer California farms lost money in 2022 as compared with 2017, but those who did saw significantly bigger losses. Also, average profits in the Golden State were considerably higher than those in the country as a whole.
The federal numbers being highlighted by the California Farm Bureau Federation are available online at https://www.nass.usda.gov/Publications/AgCensus/2022/Full_Report/Volume_1,_Chapter_2_US_State_Level/. The organization plans to host a news conference on the consolidation-related findings today just outside the state Capitol building in downtown Sacramento.
According to the USDA, California's total farm count dropped to 63,134 in 2022. Nationally, it reported, the decline between 2017 and 2022 was about 7%.
The average size of California farms increased by 10% during that five-year period to reach 383 acres. Across the country, the size increase was just 5%, though the U.S. average finished the period higher, at 463 acres.
USDA data showed the number of Californian farms reporting a profit dropped about 18%, while the size of those net gains rose 76% to hit an average of $665,459 per year.
By comparison, the number of farms nationwide that made a profit shrank only 9%, according to the USDA, which noted the average size of those profits rose 78% to reach $224,025 per year.
In California, the number of farms reporting a net financial loss declined 5% between 2017 and 2022, the USDA reported. It noted the average size of those losses increased 87% to finish the year with a profit averaging $104,258.
The number of U.S. farms reporting a net loss also declined during the period, by 6%. But as happened in California, their losses rose — by 36% to reach $28,597 per year.
Douglass, the state farm bureau president, did not bring up the industry challenge presented by the Trump administration's threat to deport undocumented residents. But she acknowledged that mass deportations could present problems for farmers.
"I think that anytime we're talking about threats to our workforce, those are definitely challenges that impact our farms," she said.