How Much Do Farmers Earn? (2020 Overview)
How much a farmer earns is highly dependent on the type of farmer they are, how much land they have, and the product their farm produces. Most farmers make a modest amount that affords them a decent standard of living no matter where in the world they live.
However the amount of money a farmer makes per acre can vary drastically depending on whether they’re raising corn, soybeans, apples, hay, cattle, or a variety of agricultural products.
We’ll cover what each type of farmer makes and the potential earnings if someone looks at farming as more than a job or a way of life, but instead as an investment or business.
Rural Everyday Farmers Living Conditions & Income
Everyday Rural farmers as we like to call them — folks who own a small ranch out in the countryside — often make between $20,000 and $36,000 per year, which definitely isn’t all that much — however their living expenses are far lower than city folk, often being only a little food and utilities, some basic farm supplies, and whatever luxuries they may want to keep them entertained in their down-time.
It’s a decent simple lifestyle, however it doesn’t provide much security when old age comes and working the farm becomes less feasible, and overall doesn’t provide much extra income to invest, save, or spend on vacations and the like.
This low pay largely due to Rural farmers using older (crop) farming techniques passed down many generations and having somewhat ethical living conditions for animals they may be raising for slaughter/sale, which simply nets a lower yield of both crops or livestock per acre of land and time spent. This isn’t to say it’s a bad thing — such compromises have benefits to the farmers quality of life, however it does hurt their incomes greatly.
These farmers live a relatively good simple life with plenty of free-time (although often they put it back into hobby projects on the farm), but don’t treat their farm like an investment or business most of the time, but rather as a way of life. There’s nothing wrong with that, however it is different compared to some other farmers. 9 out of every 10 farmers fit into this category in the USA — despite this they make up less than 20% of the overall farm yields throughout the USA.
Small-Scale Niche Farmers Living Conditions & Income
By this we mean farmers who operate a small plot of land and treat it link a business — a real business — not a way of life. They account for only 4 in 100 or so farmers, and they produce a lot of the extremely pricey vegetables and herbs — think Rosemary, Basil, Organic Kale, Alfalfa Sprouts, turmeric root, ginger, parsley, etc.
This is downright the best way to farm in my opinion in terms of making money without compromising your ethics — it’s not only relatively environmentally friendly, but you can do it only an extremely small plot of land and make easily 100k+ a year off just a couple of acres of land — and if you have capital and extensive knowledge and find an underserved market it can yield greater than 1 million dollars per year.
This isn’t without compromise though — It takes a lot more work to maintain a farm like this as it requires meticulous planning, organization, and supply chain logistics knowledge, and ultimately you have to work your butt off nearly constantly unless you have a couple very knowledgeable trusted partners who can help in certain areas of the business such as sales, harvesting, and packaging.
If you’re interested in this farming style I’d recommend checking out “Red Gardens” on Youtube or books like The Urban Farmer by Curtis Stone which offers great insight into this method — and before you jump on this like a quick rich quick scheme if you dare to get into the industry you need to do proper market research and see if there’s enough demand for it in your area and that there aren’t too many farms doing it already which is certainly the case is some more developed markets like West-Coast of the USA. You’ll need tens of thousands of dollars and a year of free-time to study and pull this off unless you get creative with land you have access to (rent/own already) and ample knowledge already.
Due to the absurdly high yield, assuming property zoning laws permit it, you can do this just about anywhere (even in a big backyard) and make great money, and due to the practices you can easily farm in most climates in the world all year long.
Large-Scale Industrial Crop Farming Living Conditions & Pay
These are the big boys that own tens of thousands of acres of land — millions of dollars worth of land — they make up about 2 in 100 farmers due to the sheer concentration of this industry, despite producing well over half of all fresh produce in the United States.
Due to the sheer size of these farms they often require advanced machines and tech, lots of chemicals and fertilizers, and advanced irrigation tech to maintain the crops and keep them going — and do to the sheer size of them the owners make a killing. Every acre they own will bring in about $400 -> $700 a year on average, but after all the overhead the expenses the profit is often limited to just a $50-$200 an acre.
This may not sound like much, but when you expand that out that means the owner of the farm generally profits $50,000 -> $200,000 a year more or less guaranteed due to them generally having insurance in case of crop failure and buying futures contracts that allow them to guarantee they can sell the crop at a certain price when it’s ready to be harvested. They also generally pay down the loan on their land by $5000 -> $15000+ a month which contributes to their networth if they ever choose to sell their farm.
This may sound fantastic — but it requires a lot of knowledge of financial markets, enormous amounts of capital to get the equipment and land, and generally a lot of risk that makes this only suitable for the very wealthy and well-educated or for medium-size corporations. More often than not however it’s done by large multi-national corporations worth billions who lease the land from land-owners for decades at a time while keeping around 60-70% of the profits.
Due to the rather outsourced mechanical nature of this sector of farming, the living conditions aren’t really able to be spoken of. The outsourced labor, when needed (harvesting) often don’t have very good working conditions at all, however the farmers or land-owners often just do planting (if that) in a luxurious A/C GPS-controlled semi-automated tractor, so they literally would not be sweating at the job.
Factory Farm Owners - Morality for Sale - Income & Living Conditons
These farms are where almost all meat, dairy, and eggs come from. The really crowded over-stuffed unsanitary hellholes for animals come at a price — and that price of suffering is a discount in operating expenses for the farmers.
While I am ethically against such farms, they can make a killing (figuratively and literally I suppose), however due to the increasing greediness of the corporate overlords who have a strangle-hold on the industry (Tyson for example) you’re completely at the whims of them and they can put you out of business, hurt your business, or make you wildly successful depending on more or less how much they like you and you bribe them (contribute to lobbying groups they support).
Farmers like this make anywhere from losing everything they have if they speak out against the industry to $300,000 a year if they’re morally bankrupt and the crony’s in the industry line their pockets for loyalty. It’s really a toss-up, 65% of farmers in this category are struggling to survive, 5% are doing fantastic, and 30% are doing quite alright (upper-middle class) without having to do much work other than the psychological strain of running such a cruel operation takes on someone — much like war does to many soldiers.
This category makes up the remaining 4 out of 100 or so farmers, and they produce together over 99% of the Meat, Eggs, and Dairy in the United States currently.
What about outside of the USA?
The proportions are way different, as is the earnings, outside of the USA. Small-scale “urban farms” are way more common and factory farms and large-scale industrial crops are way less common. Pay is generally a bit better for rural farmers and factory/industrial farms make less due to them not being the dominant market-share players with as much pricing-power.