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Overview of Kentucky Agriculture, part 2

Recently, CEDIK released the updated Agriculture & Food County Data Profiles (click here to see) for 120 Kentucky counties. Using data from the 2012 Census of Agriculture released last year from the US Department of Agriculture National Agricultural Statistics Service (USDA/NASS), these profiles offer an overview of the agricultural industry and food system at the county level, but not for the entire state. So in this blog post, we examine some additional data across all of Kentucky.

First, let’s take a short look at land area designated for agriculture purposes. The data show that nearly 52% of Kentucky’s land was designated as farmland in 2012. The map below illustrates differences in the percent of county land that is classified as farmland across Kentucky. Out of Kentucky’s 120 counties, at least half of the land in 71 counties is classified as farmland. Not surprisingly, the map shows that most county land is used for farming in Central Kentucky and select counties in Western Kentucky, while relatively little land is used for farming in Eastern Kentucky.FarmLandPercent

Now that we know where the farms are located, how many are there and how much are their sales? In 2012, there were 77,064 farms in Kentucky; USDA defined a farm as any place that produced and sold (or normally would have sold) $1,000 or more of agricultural products during the Census year. In 2012, the overall sales of these farms from crops, animals and related products was nearly $5.1 billion throughout Kentucky. From these, $2.8 billion (55%) came from sales of animals and animal products and $2.3 billion (45%) came from crop sales. While $5.1 billion is a lot of money, is it enough for every farmer to make a living? $5.1 billion in sales divided among 77,064 farms means that each farm, on average, made about $66,000 in sales, which does not include production costs.

However, we know that farm sales can vary significantly from the average depending on farm size and other factors. A closer look at the distribution of farms by the value of sales, presented in the graph bellow, illustrates that only 13% (10,222) of farms make more than $50,000 in sales per year. This suggests that the average of $66,000 in sales per farm is definitely skewed by a few very large farms that bring in a lot of revenue. In fact, out of those 10,222 farms that made more than $50,000 in annual sales, 6,340 have a sales volume greater than $100,000.FarmBySales

Again, one must keep in mind that we are considering sales here, not net receipts. If we assume that a farm’s profit to its owners (often, the farmer) is its annual sales plus other revenues minus production costs, then we speculate that perhaps 13% of Kentucky farms potentially earn enough in sales to make a living from the farm alone. Conversely, more than 63% (48,931) farms are very small in sales making less than $10,000 annually. Since there is likely little profit left after subtracting production costs, farms in this category most likely are not operated by not full-time farmers, but rather those who live on the farm and mostly work elsewhere. This may also be true for some of the farmers in the second group in the graph: those that make between $10,000 and $50,000 in sales. The distribution of farms by sales suggests that while farming takes up a large percentage of Kentucky’s land, a farmer’s dependence on the farm for a source of income may vary greatly between and within the counties.

Interested in a particular county? Check out CEDIK’s Agriculture & Food County Data Profiles by clicking here.

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