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Down cycles in ag lead to more farm transitions

An agricultural economist says downturns in the ag economy typically lead to an increase in farm transitions.

Dr. David Kohl, professor emeritus at Virginia Tech, tells Brownfield…

“Given the economic cycle this whole thing of transition management will accelerate because I’m hearing a number of the senior generation saying maybe it’s time to move on and cash out,” he says.

He says the economic environment unfortunately lends itself to farm fragmentation.

“But then the kids that aren’t interested in the farm and the ranch, they want theirs, and they want it now, and the existing family member can’t afford to buy out the others.”  He says, “What happens is the farm gets fragmented, and oftentimes it’s not of economic size to make sense.”

However, Kohl says it’s an opportunity for the industry’s next generation to gain a foothold.

“Often talking with the senior generation and younger generation, they say when it’s not family we get right down to business,” he says.

Kohl says 21% of American farmers and ranchers have no next generation to pass on the farm.

AUDIO: Dr. David Kohl – Virginia Tech University