By Boyd Champness
THE USA expects to lose more than half of its two million farmers over the next decade, according to one of Americas leading producers.
Professional Farmers of America (Pro Farmer) president Dan Manternach told stunned Australian farmers at a conference in Bendigo, Victoria, last week that the massive reduction in farmers would come from the mid-sized farm sector.
Speaking to farmers via a live video link from his base in Iowa, Mr Manternach, president of one of Americas strongest farm unions, said many of Americas mid-sized farmers were not big enough to compete with the very large farmers, yet were too small to consider off-farm employment.
With his comments appearing in The Weekly Times, Mr Manternach told the Farm Management 500 conference: “Its a phenomenon we call the polarisation of farmers based on scale.
“They are being forced to either expand to reach maximum economy of scale, or cut back and find some off-farm employment.”
He believes the attrition rate will be greater than that experienced during the agricultural depression of the mid-1980s.
With the average age of US farmers at 56, many of the displaced will simply go into retirement.
“Some will work for other farmers, some will custom-farm for other farmers, some will downsize and find off-farm employment and some will leave farming altogether,” he told the conference.
Those that are left will account for an increasing percentage of Americas total farm output.
“At the moment the top 25% of US farmers account for 65% of total annual agricultural output of US$200 billion (£125bn). Of these, 7% account for 40% of the total output,” he said.
Mr Manternach said the farmer of the future would spend very little time on the land, instead becoming more business and customer-orientated.
“They will be spending most of their time in an office, on the telephone, on the Internet and they will be hiring people to run the machinery,” he said.
Farm Management 500 project manager Phil OCallaghan told the conference that Australia would not experience the same level of decline in farmer numbers over the next decade because rationalisation has been under way for some time in this country.
He said the USA had more to do, because its farm subsidies were higher. “Australias has been a much more open and unsubsidised system,” Mr OCallaghan said.
But both men agreed Europe was in for a rude awakening when free trade becomes a reality in about 2010.
“The big losers will be the European farmers,” Mr Manternach said.
“A big reason Europe is clinging to its high price supports is the memory of the older generation of food shortages in World War II.
“As they decline in number, we suspect the baby-boom generation is going to be less tolerant of subsidies and high costs in Europe.
“The big winners will be Eastern Europe, South America and producing countries close to Asia, such as Australia, particularly when China is allowed to join the WTO,” he said.