Sustaining the Family Farm at the Rural Urban Interface: Comparing the Reproduction Processes of Commodity and Alternati

1. Sustaining the Family Farm at the Rural Urban Interface:Comparing the Reproduction Processes of Commodity and Alternative Food & Ag. Enterprises Shoshanah Inwood, Rural Sociology Program, HCRD, OSU Jeff S. Sharp, Rural Sociology Program, HCRD, OSU Doug Jackson-Smith, Dept. of Sociology, Social Work and Anthropology, USU First what I’d like to do is tell you the context of this study, followed by why studying the process of succession at the RUI is important and then how this fits into a larger projectFirst what I’d like to do is tell you the context of this study, followed by why studying the process of succession at the RUI is important and then how this fits into a larger project

2. When the city is encroaching on the farm, assume that will have bulldozing and then decline of agriculture. We recognize this is not the case and this project is actually part of a larger study looking at agricultural adaptation at the RUI joint project between OSU and USU. Half of all sales are at the RUI. This project is at the intersection of three literatures: RUI, agrofood systems, and succession Slide about lnad at the RUIWhen the city is encroaching on the farm, assume that will have bulldozing and then decline of agriculture. We recognize this is not the case and this project is actually part of a larger study looking at agricultural adaptation at the RUI joint project between OSU and USU. Half of all sales are at the RUI. This project is at the intersection of three literatures: RUI, agrofood systems, and succession Slide about lnad at the RUI

3. Agricultural Change at the RUI Models & Literature Central Place Based Models Von Thunen Sinclair Model (1967) Farm & Individual Level Models Johnston and Bryant(1987) Heimlich and Brooks (1989) Multi-Level Models Smithers and Johnson (2004) Ag Adaptation Models Lapping and Pfeffer (1995) Lockeretz (1997) Recognize Agriculture Adapts Metro counties lead in sales of fruits/veg Nursery greenhouse crops. Vs. poultyr dairy and livestock are in fringe metro counties. And non-metro counties Farm decision making influences different types of agriuclture found at the RUI: more diversity in scale, type and value of production and type of operator Recognize Agriculture Adapts Metro counties lead in sales of fruits/veg Nursery greenhouse crops. Vs. poultyr dairy and livestock are in fringe metro counties. And non-metro counties Farm decision making influences different types of agriuclture found at the RUI: more diversity in scale, type and value of production and type of operator

4. Sinclair (1967) Variant of Von Thünen hypothesis Land rents primary determining factor in organization of ag. High value, urban ag in or nearest urban core Sinclair recognized that urban development affected agriculture – first to do so. 1. Increased land prices — Agricultural land values and real-estate costs such as property taxes, interest payments, and rents are at levels higher than would be observed on the basis of discounted agricultural earnings alone. 2. Disinvestment in farming — There is a decline in productive investments in agriculture, particularly in farm buildings, machinery, and livestock. 3. Reduction in the intensity of agricultural production — In anticipation of future urban land conversion, less-intensive production may be chosen to simplify management (e.g., a shift from livestock to cash grain farming). 4. Land speculation — There will tend to be a heightened rate of land transactions and an increase in the rate of increase in land values; farmland may increasingly be owned by nonfarm entities who are interested in farmland mainly for asset appreciation; nonfarm entities will normally be less reluctant than farm people to convert the land to urban uses. 5. Environmental degradation and reduction of land quality — Soil erosion investments are left unmade; conservation practices (e.g., crop rotations, strip and contour cropping) may be abandoned for cheaper or less labor intensive practices. 6. Increased urban interferences with farming — These interferences may discourage farming or cause some farmers to abandon certain types of agriculture (e.g., livestock) or to see selling out as a desirable option. Sinclair recognized that urban development affected agriculture – first to do so. 1. Increased land prices — Agricultural land values and real-estate costs such as property taxes, interest payments, and rents are at levels higher than would be observed on the basis of discounted agricultural earnings alone. 2. Disinvestment in farming — There is a decline in productive investments in agriculture, particularly in farm buildings, machinery, and livestock. 3. Reduction in the intensity of agricultural production — In anticipation of future urban land conversion, less-intensive production may be chosen to simplify management (e.g., a shift from livestock to cash grain farming). 4. Land speculation — There will tend to be a heightened rate of land transactions and an increase in the rate of increase in land values; farmland may increasingly be owned by nonfarm entities who are interested in farmland mainly for asset appreciation; nonfarm entities will normally be less reluctant than farm people to convert the land to urban uses. 5. Environmental degradation and reduction of land quality — Soil erosion investments are left unmade; conservation practices (e.g., crop rotations, strip and contour cropping) may be abandoned for cheaper or less labor intensive practices. 6. Increased urban interferences with farming — These interferences may discourage farming or cause some farmers to abandon certain types of agriculture (e.g., livestock) or to see selling out as a desirable option.

5. Smithers and Johnson (2004) Higher level effects (vertical) Local level effects (horizontal) Filtered through farm household (which are not separate) No consistent approach Not often tested Do not include contemporary themes Higher level effects (vertical) Local level effects (horizontal) Filtered through farm household (which are not separate) No consistent approach Not often tested Do not include contemporary themes

6. Agriculture at the RUI –Johnson and Bryant (1987) Positive Adaptations -enhancing farm production, add nontraditional enterprises or intensifying Normal Adaptations - managerial adjustment Negative Adaptations – an exit /withdrawal Diversity of farming structures at RUI Motivations for farming Farm and household decision making factors Life cycle effects Commodity structure Presence or absence of identified heir

7. Initial Model of Agricultural Adaptation

8. Purpose of Project Ag Adaptation Sustainability Environmental, Economic, Social Social Sustainability Reproduction and Succession of the Farm Research Questions Is succession an issue at the RUI? How does succession influence the trajectory of agriculture at the RUI?

10. Links Between Alternative Agriculture at the RUI & Retention of Farmland Alternative Food and Agriculture Enterprises (AFAE) Local Food Systems Direct Marketing Value Added Processing Shortening of Supply Chains (Renting et al.2003 ) Market Stream is Key Definition not production practices Does not include off-farm income as part of definition of pluriactivity (Ilbery, Marsden) Key characteristic is marketing stream. Could be grass based dairy farmer but if seling ou Note that Jeff and Doug are discussing this project at the more marcro levels and I’m going to be focusing in on the household Pluriactivity here – different then the European literature, no added non-farm income as part of definition for AFAEKey characteristic is marketing stream. Could be grass based dairy farmer but if seling ou Note that Jeff and Doug are discussing this project at the more marcro levels and I’m going to be focusing in on the household Pluriactivity here – different then the European literature, no added non-farm income as part of definition for AFAE

11. Key Characteristics of AFAEs Generate higher economic returns per acre ? offset rising land costs Entrepreneurship ?become price makers vs. price takers Hospitality oriented with products and value added activities Recognition of barriers to adaptation and change but little research has examined the empirical realities of: rates at which farm families are able to transition their operations into AFAE’s the effect succession has on the trajectory of agriculture at the RUI Diversification strategy institutionalized via academic arguments, extension, gov’t funding, NGO’s, farm organizationDiversification strategy institutionalized via academic arguments, extension, gov’t funding, NGO’s, farm organization

12. Succession and Reproduction of Family Farms Rich research tradition in rural studies linking intergenenerational transfer of farmland and persistence of family farms. Farm Family is influenced by external (global, national, and local conditions), farm agroecology and household factors Gasson and Errington (1993): 3 processes in intergenerational transfer of family farm business Inheritance – legal transfer Succession – transfer of managerial control over use of these assets Retirement- withdrawal of current manager Multi stage process influenced by : socialization, ethnicity, values, lifecycle effects, family structure, and personality/business orientation (Bennet and Kohl 1982; Salamon 1992)

13. Continuum of Farms at the RUI

14. Succession at the RUI

15. Methods In person semi-structured interviews AFAE Farmers Commodity Farmers Mixed Farmers Central Ohio- Columbus Metro Region Western Michigan- Grand Rapids Metro Region N=43 Three types broad based, based more on market stream and regional local,shortening chain then by type e.g. grass based, organic etc. Farm Families Individuals Three types broad based, based more on market stream and regional local,shortening chain then by type e.g. grass based, organic etc. Farm Families Individuals

16. Respondent Characteristics Equal membership in Farm Bureau AFAE’s belong to more religious organization -surprisingEqual membership in Farm Bureau AFAE’s belong to more religious organization -surprising

17. Respondent Characteristics Con’t See commmodity farms get most of their income from farming, AFE’s get least amount of income from farming activities, but most likely to identify primary occupation as farmer AFAE’s may be less likely to have kids involved because are sending kids off to school to experience other things, also get labor from other family members and most likely ot have employees. Also speaks to the types of operations they are running that need more marketing and labor in field then commodity producitonSee commmodity farms get most of their income from farming, AFE’s get least amount of income from farming activities, but most likely to identify primary occupation as farmer AFAE’s may be less likely to have kids involved because are sending kids off to school to experience other things, also get labor from other family members and most likely ot have employees. Also speaks to the types of operations they are running that need more marketing and labor in field then commodity produciton

18. Identifying the Next Generation Mixed Types are one of more intersting, have highest percentage of yes, will be interesting to see how these results compare to larger data set. Unsure also larger. Mixed Types are one of more intersting, have highest percentage of yes, will be interesting to see how these results compare to larger data set. Unsure also larger.

19. No Heir Identified Land Trust Meadows Grass Beef Deeds Family Farm Decline and Disinvestment Meyers Dairy Blog Orchard

20. “The Intensifiers” Third Generation FarmThird Generation Farm

21. “The Mixed Stackers”

22. “The Entrepreneurial Stackers” We are a fifth generation, family-owned and operated farm.We are a fifth generation, family-owned and operated farm.

23. “The Expanders”

24. Intensification Expanders and Intensifiers Growth via expansion of land Value Added to existing commodity mix Entrepreneurial Stackers This study is at intersection of various literatures RUI Literature Agro-food systems Literature Succession Literature RUI Literature Agro-food systems Literature Succession Literature Stack multiple enterprises in horizontal and vertical directions on same land base Due to increasing pressure Stack multiple enterprises in horizontal and vertical directions on same land base Due to increasing pressure Intensification Expanders and Intensifiers Growth via expansion of land Value Added to existing commodity mix Entrepreneurial Stackers This study is at intersection of various literatures RUI Literature Agro-food systems Literature Succession Literature RUI Literature Agro-food systems Literature Succession Literature Stack multiple enterprises in horizontal and vertical directions on same land base Due to increasing pressure Stack multiple enterprises in horizontal and vertical directions on same land base Due to increasing pressure

25. Conclusions No Heir Identified Decline and Disinvestment Land Trust Heir Identified ? 2 Types of Growth and Intensification Expanders and Intensifiers Growth via expansion of land Value Added to existing commodity mix Entrepreneurial Stackers Increasing Specialization Allows for stacking Raises questions about: continuation of production role of gender in the succession process at the RUI

26. Next Steps Complete Interviews for full analysis Phase 3 of analysis Regression analysis of surveys sent to 300 landowners in each of the 8 case study counties Research Questions Does succession influence the structure of agriculture at the RUI? Do succession processes differ between AFAE, Mixed and Commodity farms?

27. Thank You For more information contact: inwood.2@osu.edu This project was supported by NC-SARE Graduate Student Research Grant OSU-OARDC Graduate Student Seed Grant OSU-Social Responsibility Initiative Graduate Student Grant The National Research Initiative of the Cooperative State Research, Education and Extension Service, USDA, Grant # 2005-35401-15272