Why Are Farms Getting So BIG?

Hint – it’s not because they’re greedy “factory farms”.

The farm I’m involved with got its start many decades ago. My grandparents started farming in another area after marrying, where they lived in two grain bins pushed together. Grandma told me recently that the water leaks may well have been the worst part of that residence!  After years of toil and struggle in an area prone to drought, they moved to our current location, in 1956. My dad succeeded grandpa in the late 70’s, and now the third generation is well on its way to succeeding him. Someday, perhaps, if we’re lucky, there may even be a fourth. It’s amazing that some farms in parts of eastern North America are already in their 7th or 8th generation!

A picture of our farm from 1956

Here’s a statistic for you: 3% of family businesses survive to the fourth generation. This is generally true for family businesses and even very large ones. The ones that do survive inevitably become larger with time to support a growing number of family shareholders. So, are farms any different from other family businesses in this regard?

In 1936, there were 142,000 farms in Saskatchewan, which was the largest number this province had ever seen – and would ever see. In 2016, that number had dropped to 36,952. You could go anywhere in the developed world (and in much of the developing world) and find the same trend: over time, the number of farms declines. This has been ongoing for a hundred years. The question is, why?

Like everything, the answer is… complicated.

Farming is not an easy way to make a living. The two primary determinants of your income, weather and commodity prices, are outside of your control. Also, especially in the past, operating a farm was a job that required you to be a jack-of-all-trades. If something broke, you had to fix it. If you didn’t get your crop off in 1896, you died. Simple as that. You and your family depended on your production to survive. Unfortunately, in many parts of the world, this is still the case. Extreme physical labour has always been a part of farming, which has only just lately been lessened with improvements in technology and mechanization.

Living on a farm is also isolated. This wasn’t as much of an issue several decades ago when there were neighbours all around you, but a farm is still very different from the city. Numerous services are not available, including health care, when you live hours away from the nearest city. Today, lack of good Internet service has become a glaring problem as well for rural people.

The Industrial Revolution was one of the greatest achievements of humanity. It allowed us to leverage our skills and strengths with machines and technology, creating the opportunity for us to emerge from a world of abject poverty and destitution. For the first time in human history, the life for your children really could become something better than your own had been. There were opportunities for people to be able to do what they wanted to do – not what they had to do to survive. And people accepted this chance in droves, moving to the ever-growing cities to build better lives than their parents had.

I mean, really, what would you have done in 1912? Stay on the farm in the bald prairie of Saskatchewan, hoping to produce enough food to survive the harsh winters, and maybe, if you’re lucky, produce enough to be able to sell some of it to buy clothes and heating? Some made that choice, but most didn’t. Most jumped at the opportunity to move to the city and fulfill their dreams.

If you think about it, if you set your mind to it, you can literally acquire almost any career you want. The ability for people to find a career they love is how we have so many of our modern amenities and services. The explosion of wealth in the last few hundred years, and in the human population, is because of the success of agriculture in reducing its labour needs. Mechanization allowed farmers to employ fewer people.

Here’s the reality: people aren’t forced off the farm. They choose to leave.

As the number of farms declines, what happens with all that farmland they leave behind? Someone is going to farm it. Obviously, this creates bigger and bigger farms. Why would another farmer want to take that land on? The same reason your grandparents moved to the city in the first place – opportunity.

For those of us who chose to farm for a career, expansion creates opportunity for us to grow our businesses, and seek a better living for ourselves and our families. I don’t know what you might do for a living, but let’s say you work for a big company, a bank, a university, or even at a small business. Over the course of your career, do you hope to make the same amount of money you make right now? Or do you hope that you’ll get promotions, pay raises, better benefits, and so on? Do you hope to be able to achieve a higher standard of living? If you run your own business, do you hope it grows? Do you hope you’ll acquire new customers and demand?

I hear, all to often, that big farmers don’t need to farm so much land. That they should save some for the little guys, that they’re just being greedy trying to farm so much.

Here’s my question: how do you know what’s best for anyone else?

Growing my farm allows me to hire more people. It creates the ability to increase my net income, which has the effect of increasing my family’s standard of living, just as a pay raise would for someone working for a company or the government. There are innumerable benefits to growth, if handled correctly. Of course, lots of farms grow too big too fast and outgrow their ability to manage it. Lots of farms have failed because of this. That is the nature of free markets and capitalism; some businesses fail. And that’s okay. Our free society depends on this creative destruction – the freedom for us to make our own choices, and live with the consequences.

We shouldn’t begrudge those who have had success in their lives, even if their relative success is greater than ours. Being successful takes risk! Expanding a farm, just like any other business, is a risky, stressful endeavour, with no guarantee of success. Celebrate the wins of your peers, don’t try to bring them down. They are in the game, taking the risk: the risk of failure, for the chance at greater success for them and their children. Let people have the freedom to make their own choices. That dream is what our society was built on.

2 Thoughts

  1. Thanks for sharing Jake. Well written!

    L.T.(Larry) Hilworth Larry Hilworth Ventures Ltd. Maple Properties Ltd. Yorkton, Sask. Canada 306-621-5727 cell 306-783-6813 home office

    LT Motorsports – FB

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  2. Totally agree with you Jake. The alternative idea is romanticism at its worse. My great-grandfather moved from the Ukraine to homestead in Saskatchewan in the 1880’s. He moved back to the Ukraine eventually moving to Chicago where he became a tailor. I admire farmers for what they do (i.e. they are crazy) and am glad that I have worked in the area of improving crop technology (from the relative warmth of my desk and lab in St Louis MO).

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