SIC 0191 General Farms, Primarily Crop

Encyclopedia of American Industries | 2005 | Copyright

SIC 0191
GENERAL FARMS, PRIMARILY CROP

This industry classification is comprised of establishments deriving at least half the value of their total agricultural sales from crops, but less than 50 percent of the sales are from the products of any single, three-digit industry group. Crop farms deriving 50 percent or more of their total agricultural sales from products classified within a single three-digit grouping are classified according to that grouping.

Specified three-digit classifications are: 011 cash grains (wheat, rice, corn, and soybeans); 013 field crops (cotton, tobacco, sugarcane, sugar beets, and potatoes); 016 vegetables and melons; 017 fruits and tree nuts (berries, grapes, citrus and tree fruits such as apples, cherries, peaches, and pears); and 018 horticultural specialties (ornamental and nursery products and food crops grown under cover, such as mushrooms and bean sprouts).

NAICS Code(s)

111998 (All Other Miscellaneous Crop Farming)

Industry Snapshot

Farming has long been one of the staple industries in the U.S. economy, and at the beginning of the twenty-first century, the United States was the world leader in crop harvesting. Like many industries, crop farming under-went rapid consolidation in the late 1990s, in which large agribusiness firms increasingly took the place of smaller family farms, resulting in reduced employment levels, as farms tried to boost efficiency to remain competitive.

According to the U.S. Department of Agriculture, in 2001 there were 2.16 million farms in operation in the United States, up just a fraction from 2000. This increase of approximately 0.1 percent occurred primarily in small farm operations of $1,000 to $9,999 in sales. The total cash receipts for agricultural crops sold in 2001 fell to $88.5 billion, down from $106 billion in 1997. Nearly three-quarters of total sales was derived from various grains, of which the largest portion came from corn for grain, which brought sales of $19.2 billion. Other major sources of revenue in 2001 included hay ($12.6 billion); soybeans ($12.4 billion); fruits, nuts, and berries ($11.6 billion); vegetables ($10.4 billion); wheat ($5.6 billion); cotton ($3.4 billion); and tobacco ($1.9 billion). In 2000 net income for the U.S. farm industry was $46.4 billion, down from a decade-high $54.8 in 1996, but up from a decade-low $36.9 in 1995.

In addition to battling chronically low agricultural-commodity prices in the late 1990s and early 2000s, farmers faced a host of challenges relating to environmental and health concerns. As consumers and regulators placed heightened emphasis on water and land conservation and the minimization of pollutants, many farmers have rapidly attempted to reorganize their production to become more environmentally sound. Moreover, concern was on the rise over the presence of chemicals in foods, forcing farmers to rethink their pest- and quality-control practices. Finally, the practice of genetically modifying seeds and foods has generated national and international controversy relating to environmental, economic, health, and ethical concerns.

Organization and Structure

In 1997, 86 percent of farms classified in the industry were owned by sole proprietors. Nine percent were organized as partnerships, two percent were family corporations, and about two percent were held by non-family corporations. The remainder were operated by other entities, such as cooperatives, institutions, and estates. These statistics were comparable to the ownership structure for all U.S. farms.

Farm operators were classified by their ownership interest in the land. Full owners owned the land they operated; part owners operated part of their own land and rented the remaining land; tenants rented the land they worked. Sixty percent of all general crop farms were predominantly operated by full owners, while partners operated 30 percent and tenants 10 percent.

Background and Development

European colonists learned about cultivating plants indigenous to the United States, developed an agricultural industry, and modified it to suit their own needs. European settlers brought horses and oxen to the continent and put them to work as draft animals. They imported seeds and introduced wheat, rice, barley, oats, rye, and buckwheat. In areas with rich soil, abundant production soon surpassed local demand, and, during the seventeenth century, exports were used to finance imports of manufactured goods. Crop production varied by area; in New York, Pennsylvania, New Jersey, and Delaware, farmers were primarily grain producers. In addition to grains, farmers in Maryland, Virginia, and North Carolina grew tobacco and vegetables. Rice and indigo were the main crops in South Carolina and Georgia. Commercial production of indigo, which had prospered under British rule because of preferential trade treatment, ceased following the Revolutionary War. Cotton was not fully developed as a commercial crop until later.

Colonies were generally forbidden to trade with countries other than their "mother" country. English colonies traded only with England; Dutch colonies traded only with Holland; Spanish colonies traded only with Spain; and French colonies traded only with France. This type of trade restriction was one of the contributing factors leading to the Revolutionary War.

Events surrounding the war's conclusion set the stage for the development of farming practices within the United States. Under the terms of the peace treaty signed in 1783, England surrendered its claim to the colonies and its claim to an additional 237 million acres located west of the Ohio River. The original 13 states agreed that the western territory would be held in public domain by the federal government for the purpose of distributing it equitably to settlers.

The process of selling units of western land to farmers began in 1785, two years before the Constitution was adopted. Under the terms of the Land Survey Ordinance, lands were portioned off into townships containing 36 sections of 640 acres (one square mile per section). These were further subdivided into 16 units. Farmers could purchase up to four units, equaling one-quarter section (a total of 160 acres), at...

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