Rule of thumb in the area where my family lives, Hamilton County in Nebraska, is that 1000 acres will be required to financially support a family of four. Land has sold within the last four years from $6K to $10k per acre. Therefore, using the low number, one family will need to be able to raise crops on $6,000,000 worth of land by owning or leasing the ground.
We haven't gotten to equipment yet. Center pivots start at $35K, tractors are about $100K, combines are $250K. We still need heads for the combines for each crop raised, and of course plantering, fertilizing, cultivating, ridging, and discing implements to tend the land. Figure $25K apiece. Add 15% if they're the proper shade of green.
I could keep going, but you get the point, hopefully, that farming is an extremely expensive enterprise with relatively low margins.
"Should" it be that way? With respect, what ag should or should not be isn't irrelevant. It is that way, and this is not a function of ag but rather a function of an industry working to supply demand.
Ag is not remotely unique in the assets that are required to operate. Watch the first season of How It's Made on Netflix and be amazed at how much expensive mechanization and automation is required to make something as simple as a work boot.
This is perhaps what happens when your housing bubble has a knock-on effect on land values and those in turn drive up the cost of doing business for the farmer.
The equipment today is outlandishly expensive. While the equipment is well made, there's surely room for innovation. Just as we can apparently find ways to send things into space for a fraction of the conventional cost, there has to be a way to make a combine harvester, or something functionally equivalent, for less than a quarter million dollars.
We haven't gotten to equipment yet. Center pivots start at $35K, tractors are about $100K, combines are $250K. We still need heads for the combines for each crop raised, and of course plantering, fertilizing, cultivating, ridging, and discing implements to tend the land. Figure $25K apiece. Add 15% if they're the proper shade of green.
I could keep going, but you get the point, hopefully, that farming is an extremely expensive enterprise with relatively low margins.
"Should" it be that way? With respect, what ag should or should not be isn't irrelevant. It is that way, and this is not a function of ag but rather a function of an industry working to supply demand.
Ag is not remotely unique in the assets that are required to operate. Watch the first season of How It's Made on Netflix and be amazed at how much expensive mechanization and automation is required to make something as simple as a work boot.