The Hard Truth About Being a Small Farm

I was watching a video a few weeks ago when I heard something that made me pause. The quote was: “Rich farmers feed poor people and poor farmers feed rich people”. Of course, this wasn’t news to me, but I don’t think that I’d ever heard it boiled down into such a simple format. The hard truth is that our family cannot afford to buy all of our food from small farms like our own. Buying local food is important to us, and we’re very fortunate to be able to grow a lot of our own vegetables, berries, eggs, and meats (which saves us some money), but the reality is that we still buy a good portion of what we eat through commodity distribution channels: things like flour, oats, nuts, dairy products, tropical fruits, etc. This seems hypocritical, doesn’t it? We’re always encouraging folks to eat more locally, and yet here we are buying food from outside of our region. I guess all of our “buy local!” posts should really include an asterisk and a note at the bottom, acknowledging that not everyone can afford to do so. We’re not here to shame anybody for the choices their budgets may force them to make, especially when we’re often in the same boat. It is truly a privilege to be able to afford to eat well in modern America.

Unfortunately, there are many people here in our town who cannot afford to buy from our farm, and this is something that weighs on us everyday. We would love nothing more than to lower our pricing to be able to serve everyone in our community, but it’s not that simple. The prices of our products may seem high to some, but they are often as low as they can reasonably be. We utilize a cost plus pricing strategy for almost all of our farm’s products, which means that we add up all of the costs of production for each item, and then add an additional percentage to determine the selling price. This allows us to know exactly what it costs us to produce a dozen eggs, for example, so that we can make a profit while keeping our margins relatively slim.

It’s impossible for us to compare our pricing to that of the major national brands like Tyson or Smithfield, because our products are drastically different in terms of quality, freshness, environmental impact, and animal welfare. Additionally, we are not operating on the same playing field as farms owned by or contracted with these big companies, because of a couple of basic economic principles: economies of scale and vertical integration. Economies of scale is the concept that businesses will see cost savings as they increase their production. These savings come about because larger businesses are able to operate more efficiently, purchase materials in bulk, and secure better deals for product distribution. Vertical integration refers to a business taking ownership of other businesses involved in its supply chain. An example of this would be a farm that raises broiler chickens buying the hatchery from which it sources its chicks, and/or building a processing facility at which its broilers can be butchered and packaged. Large farms often have both of these principles working in their favor, so their costs of production on a per unit basis can be drastically lower than ours.

If it wasn’t clear already, we are the poor farmers in this whole rich farmer vs. poor farmer scenario, but we’re not alone! Let’s look at some statistics that illustrate the current state of farming in America: just over 88% of our nation’s farms are small family farms like ours. Compared to large farms, small farms are generally more financially vulnerable. In fact, many small farms report losses, with the average annual income being somewhere in the neighborhood of -$2,900.00. Families who operate small farms tend to be dependent on off-farm income to pay their household’s bills. The USDA America’s Farms and Ranches at a Glance: 2023 Edition report states that “About 84 percent of all U.S. farm households earn the majority of their total household income from off-farm sources and often use off-farm income to cover some portion of farm expenses. As farm size increases, the percentage of households relying on off-farm income decreases.” Without this off-farm income, many families from small farms would not be able to afford to buy their own products, which in itself reveals how broken our country’s food system truly is.

So how do we remedy this situation? What can we do to make food from small farms accessible to everyone? Unfortunately, there is no simple solution. Those who have enough disposable income to source most or all of their food from small farms should make this a priority, but should also stand beside those of us who can’t as we advocate for policy changes to make the food system more equitable. Initiatives like the Double Up Food Bucks program do just that, allowing SNAP beneficiaries to purchase twice as many fruits and vegetables from farmers’ market vendors. Charitable organizations can also make an impact. AdkAction’s many food security projects are great examples of change that is being made right here in the Adirondacks. Our dream is that someday, all Americans will be able to afford to purchase good quality food grown by American farmers, and that all American farmers will be able to make a decent living growing food to feed our nation.