As farms grow bigger, Minnesota continues to lose farms

Minnesota lost an estimated 300 farms last year, continuing a regional and national trend that has seen the number of farms decline gradually and the average size increase slightly.

Minnesota now has 73,300 farms, according to the latest U.S. Department of Agriculture annual estimate. That's down 0.4 percent from 2015.

"It isn't that we're losing farmland," said University of Minnesota Extension educator Dave Nicolai. "The land is still being farmed, but the number of operators is decreasing a bit."

Extension economist Kevin Klair said there are several factors contributing to the gradual decline, including demographics — the average age of farmers in the state is 56 — and low crop prices.

Prices for corn and soybeans were phenomenal between 2006 and 2013, Klair said, but since then they have dropped significantly.

"I think some farmers delayed retirement during those years because it was just so profitable," he said. "Now the tide has turned and the financial situation isn't nearly as positive, and they're choosing to retire, particularly if they're losing money. Rather than burning through their equity they'll retire and sell out."

If prices don't improve in the next few years, Klair said he wouldn't be surprised to see the number of farms drop at a faster clip.

Another contributing factor to the long-term decline in farm numbers is technology, Klair said. Larger equipment, more sophisticated technology and improved plant genetics make it easier to manage bigger farms, he said. However, producers need to spread out the costs over larger farms that sometimes support ­multiple family members.

The USDA survey also reported that 25.9 million acres in Minnesota qualifies as "land in farms," which includes land used for crops, livestock and ranches.

That number has remained unchanged since 2013. The size of the average farm in the state in 2016 was 353 acres, up one acre from 2015.

Other states in the region reported similar changes.

North Dakota has 29,800 farms, down 200 from 2015 with the average size of 1,312 acres. South Dakota is almost identical, with 31,000 farms, down 300 from 2015, and averaging 1,397 acres.

Wisconsin lost 200 farms in 2016 and now has 68,700 at an average size of 210 acres. And Iowa dropped 500 farms last year to 87,000.

Nationally, Texas has the most farms with 241,500, followed by Missouri, Iowa, Oklahoma and California.

For all of the country, the USDA estimated the number of farms at 2.06 million, down 8,000 farms from 2015.

The report was based on surveys of producers in mid-2016, and also classifies farms in six categories, depending on the value of their annual sales. Last year, 353 farms in Minnesota reported sales of more than $1 million, about the same number as during the previous five years.

Tom Meersman • 612-673-7388