How Much Money Can A Small Farm Make? Let's Talk Numbers

In this week's episode, JM Fortier talks about a subject that is not discussed enough: farm economics and what is the goal of profit per acre.

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Dans l'épisode de cette semaine, Jean-Martin Fortier aborde un sujet dont on ne parle pas assez : les aspects économiques d'une ferme et les objectifs de profit par acre cultivé.

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[tmeconw]

$26K/acre here. That’s perhaps very low to many of you, but I’m happy as a pig-in-mud. I have all my needs met and have a strong sense of well being, so I’m not seeking more.

[buenavistagardens]

We’re at $250K per acre mainly because we have a very long season in Hawaii
If I was in the states this $150K per acre model would be exactly where I think we would be and we do currently have this profit to labor to expense ratio almost exactly. Thanks for the wise words JM

[adamjackson]

This sounds great - and, woth all due respect, it's clear JM has found success with this model, as have quite a few who devloped similar businesses.
But, now having been full-time at our farm for 5 years (1.5 acres, ~110k/year), and been connected to larger and smaller farmers in the area (Charlotte, NC) for much longer. ...I just haven't seen the >$100k/acre and 1/1/1 ratio play out anywhere outside of Youtube, *minus a couple niche microfarms.
Personally, I would be very hesitant to recommend any new farmer to take a $100k loan on a bet that their venture will cover its expenses, earn them a livable profit, and pay back that money with interest on even a 10-year agreement. Honestly, if someone's done that, I would love to hear your story.
In reality, less than half of farms survive to year 3. What's been true of most small farms in our area that are stable has been a bootstrap beginning, plus some volunteer help from the community, run by a couple or family who put in 50-60+ hrs. a week each. And those farmers are wearing a dozen hats, with minimal additional labor -- often college students or older folks helping with deliveries/packing/market stands. Though some have reached a point where they can scale back and delegate specific duties.

But beyond that - with the hope that small farms will continue to grow in number, many started by the low-paid interns and apprentices which accept knowledge as a part of compensation today - what happens when the number of farms outstrips the labor pool of passionate farmers-to-be that can afford to work for less than a monthly mortgage payment? Is it really sustainable to just cycle through every upcoming generation of prospective farmers that will then leave within 1-2 years?
I don't pretned to know it all, but I would love to hear more accounts of farms who've achieved the model JM speaks about - and how. So I can learn

[josefortier]

Jean Martin liked everything you said and I can hear my est brother in law in your words.Enjoying your talk

[stevehatcher]

On cash money sales, the off the books kind. Keep it to a minimum. Best to be able to show, on paper, and in bank accounts, something closer to true cash flow in order to maximize the amount of money you can borrow.

Not maximize as in over-leverage yourself, but not to hold yourself back because you cant quite get the loan you need, or the better interest rate you could have gotten if the bank could see lower risk in your operation.

[malalachernobyl]

I think your ratios vary from country to country! Very interesting talk particularly your profits

[j.s.boehme]

Good info. More advertisements than any 15 minute video I’ve seen in years.

[donatellapedruzzi]

9:05 I appreciate the clarity, and I think that's the number 1 reason why we should stop talking about organic small scale farming like a viable alternative system to be adopted. It is not feasible, and there is nothing wrong with it. But people should be aware of this.

[spacemanspiffy]

This video has been great. Have you ever grown/sold celery? Labor is a hard one, do you have year round employees and are they full time?

[rogeriolisto]

Weed beats carrots all-day in income😊 or at least saves my income this year.

[chrisdavis]

How do you establish who you sell to? Talk to local grocery stores?

[Millionaer]

You mean per Acer real bed surface? Or With ways? Greetings From Germany

[andrewcrabb]

Cash money is interesting and not enough talked about, but what I would like to hear you talk about is bartering. I have veggies you have eggs. I have veggies, you have meat etc, etc… the hidden value of being able to operate outside of the system. This is very interesting to all of us right??

[CatCrazyFamily]

Great information, as always thanks for sharing!!

[rogeriolisto]

Hi Jean, I would love to know how much he sells 1kg of carrots? So we can compare.

[billsmeets]

Love your book and I enjoy your videos. But I do think these numbers vary GREATLY from region to region. I live in Belgium (Europe) where the cost of labor is wildly expensive. For us, I think probably half of your revenue will be labor cost, then another 25% for operational cost at least. However, 150k/acre (Canadian dollars I presume) translates to about 250k euro per hectare. This, I think, is unheard of for any farm in western europe, whether they are organic, conventional, CSA, or otherwise...
I would be very interested to converse with other farmers from Europe who have reached these numbers indeed.

Cheers!

[PatPan]

I have a 0.5 acre with very good soil and warm weather and water how much K can i make?

[ZachSwena]

How does one go about selling produce in more rural areas away from metro areas? To hit those types of profit targets I would need to do over 6k/week during the growing/market season...

[justberealyou]

Hey am from Caribbean and I am new to farming.. I am on a 1 acre would love some help

[NewEnglandLogger]

How on EARTH you pulling those kind of numbers or even relatively close to those numbers I would love to know what type of crops or schedule that can produce that I have 27 acres at my disposal.