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Community Impacts of the Restructured Farmland Market

Illinois historically was typified by settlements of small, tightly integrated rural communities. These places functioned by having a highly engaged population and integrated by dense social networks with ties of long duration, shared life experiences, and norms of neighborliness and reciprocity that generated reservoirs of trust. Because of farming’s regional importance, these communities evolved in close association with agriculture and a high value placed on control of farmland. Such communities now face increased economic and social challenges as consequence of major structural changes in the farmland market: rapid concentration of farms, a shift from crop-share to cash-rent and an increase of absentee landlords. The project’s focus on a single farming community’s land market allows us to examine whether the original reciprocal ties between a rural community and its surrounding farm families is being altered by these fundamental changes in the local and regional farmland markets. Farmland markets are critical because farmers depend on them for access to land.

In contrast to other agricultural states, like California where agriculture is highly industrialized, Midwestern agriculture is composed of family farms, whose operators traditionally were prominent and essential players in their rural communities. Our focus is on factors that constitute a farmland market: what drives land competition (eg. farmers’ strategies for land acquisition); how the community context affects how the market works; and the reciprocal effects on the small community where the farm families and non-farmers live and work. This unique study of how a farmland market works and its effect on a specific community explores how indirectly agricultural/land market regional trends are reweaving the social fabric of rural society in the Midwest.

“Farmington” (a fictitious name to preserve confidentiality of residents), the community studied, is located in Christian County, an area important agriculturally to the Cornbelt Prairie, and home to the Dudley Smith Initiative. Farmington lies about 45 miles south of the state’s capital Springfield (population: 111,000). People from Farmington can easily travel to Springfield, Taylorville, Decatur, Litchfield or similar nearby places where more, non-farm jobs exist. Unlike many Midwestern small towns that are dying Farmington retains a relatively stable population, a lively main street, four active churches, local elementary and high schools, and robust civic engagement despite a farm population that steeply declined over the last decade.

This study incorporated close to 130 interviews and extensive participant observation of ordinary community activities including local festivals, weekly bingo games and Kiwanis Club meetings. For most of these activities I accompanied an elderly, beloved local non-farm widow with whom I also lived during weekly visits and two months each summer. A sample of 38 farmers (over 40% of an estimated 90 total) and 91 non-farm townspeople were interviewed over the course of three years (2005-2007). For comparison purposes I divide Farmington farms into three operation-scale categories according to how much acreage was farmed. Farmers also consistently divided themselves into these small, mid-sized, and large categories (Fig. 1). Average farm size changes over time of course; what is considered large today (2,500 acres and up to mega farms of 10,000+) may be considered small in the future as consolidation continues. A 48 years old farmer who works 650 acres commented on why today his farm is now considered small: “I’m a small farmer by today's standards…. I used to be big not too long ago. I have an extra business. I cannot make a living on 650 acres. The farm competition is tough in this area and everybody wants some more (land).” Similarly, farmers commonly describe the "big guys" in Farmington as those operating more than - 2,500 acres. Therefore, local categories for operation size are employed to see if, as size grows larger, farm family behaviors in the land market and the community are altered. The large category spans the greatest size differential among the three sizes, incorporating thousands of acres, but at least for now no Farmington operation is over 10,000 acres.

The findings from Farmington show critical social impacts for Illinois rural communities of the regional agricultural sector trends of farm and farmland concentration, cash rent lease increases, and more absentee landlords and operators. These trends combined are significantly altering Farmington’s social fabric.

The Local Farmland Market

In Farmington, farming change is the outcome of long-term regional trends in agriculture. I identify four major factors critical to shaping the emerging Farmington farmland market, one uniformly characterized as having intense competition:

  1. The bigger is better convention motivating farmers: A need for continual growth is an agricultural goal accepted without exception by Farmington farmers. Although farm characteristics differ according to the operation size, farmers sound similar when describing their goals for operation expansion. The fact that all farmers hold the same growth rationale, and land is a limited resource drives demand in the local land market.
  2. The shift to cash rent leases: Most Farmington farmers recall the past nostalgically when farming was a way of life as much as a business. It was a time, they said, when the community and landowners prioritized using local operators, because their employment helped the community more generally. Farmington operators still express a strong preference for crop-share leases, across all three groups of operators, and reminisce about when crop-share was the dominant leasing arrangement and the risks were shared by farmers and landlords. Only a minority of farmers (16% or 6 out of 38) prefers cash-rent to crop-share leases, although 11% (n=4) have no preference for leasing arrangements (Figure 2). Those who prefer cash-rent leases have farms in the medium and large categories. Those four with no preference are all large farmers, who might prefer less management interference to assuring less risk.
  3. New players in the farmland market: Farmland has always been a scarce, and expensive commodity for Midwestern farmers since the late 19th century. Farmington’s land market has followed the state trend of high real estate values (Table 1). New players in the local farmland market have made Farmington’s farmland more competitive and thus scarcer and more expensive in the past ten years following the state trend. In addition, farmers describe landowners newly considering only money matters (i.e. not tempered by the traditional priorities of kinship or neighborhood) - as the bottom line for land market rental and sale negotiations.
  4. Decrease in trust among farmers and the community: Competition for scarce farmland is the source of community conflicts, hard feelings and perceptions of unethical behavior among farmers, even between neighbors. Enhancing the tension is the instability of rental tenure (due to shorter leases) that makes farmers’ lives less predictable, especially among those with operations dependent on rented acreage. These factors when combined heighten the stress level reported by farmers.
    Economic studies tend to ignore the social impacts of farm concentration and increased cash rent on farming community. We examined the institutions of main street business, church membership, and community engagement that are critical to a sense of community, to learn whether fundamental changes in how the business of farming is affecting them.

Community Impacts of the Restructured Farmland Market

Small Illinois communities historically were integrated by a cohesive social fabric woven with the threads of trust, cooperation for common goals, and a culture of concern for general community well-being. I identified the transformation of farmers’ community engagement, in particular, having implications for the future well being and the sense of community in Farmington, and other farming communities like it.

In decline are three major factors that we know are critical to sustaining a sense of community in a place:

  1. Community loyalty: In the recent past residents did some shopping locally, to sustain a vital main street in Farmington. Shopping patterns have shifted to out of town businesses, and some even have transferred church membership elsewhere. Approximately 30% of farmers and 37% of townspeople do not attend church locally. In relation to shopping behavior, findings from a 1987 local study showed that 35% of the local people purchased food and 52% banked locally. Figure 3 and table 2 show the current shopping behavior of farmers and townspeople, for example, nowadays just 20% of townspeople and 13% of farmers buy food locally. Farmington’s identity is becoming that of a bedroom community as a consequence of its residents making individual choices for shopping, without concern about the well-being of locally owned businesses. Yet, when a business closes they bemoan the loss of local options.
  2. Social resources: Historically the active engagement of rural people in their community generated a store of social resources (often termed social capital) that could be drawn on in crisis or mobilized for cooperative efforts. Farmington’s store of social resources remains strong but is likely to erode in the near future. Today community social resources are now almost solely created by those who are elderly (65 and older). For example, the meetings of a local social group that I attended were composed on average of 12 residents two-thirds of them (n=8) more than 65 years of age. The high participation of Farmington elderly in community organizations and events suggests the prevalence of a past norm for high community engagement. At the same time the dominance of elderly engagement signals a decline in future reservoirs of resources due to the lower engagement of younger residents (Table 3). Traditional norms of social control (e.g. gossip, shame, family reputation) no longer are as effective as in the past at assuring the vitality of community institutions.
    Similarly, farmers’ past behavior in the local land market was shaped by community norms, family reputation and information networks. Back then building a solid reputation through social relationships and community engagement was essential for land acquisition in the farmland market. As operations get bigger farmers are less dependent on the local community for access to land. Farmers now obtain land in ways other than by being an upstanding citizen (Figure 4). Locally, little social cost is apparent for a lack of community engagement by the younger generations. A less localized farmland market (because of the presence of non-local players) and the increased use of cash rent leases have contributed to a loosening of community social ties (fewer social interactions occur), weakened social norms, and a decrease in the sense of obligation felt among farmers toward the community and its non-farmers. Not surprisingly 68% of farmers and 63% of townspeople said their participation in community activities decreased in the last 5 years.
  3. Decline of every day trust: Small town trust depends on people feeling they know everyone in the community, and that behavioral norms are commonly shared and observed. Traditionally shared norms for social control made life predictable in the neighborhood or community. Oldtimers in Farmington (over half of townspeople and almost half 48 % of farmers) say they know fewer people now than in the past because of the more transient families moving into town. These newcomers are attracted by Farmington’s small town ambience, reasonably priced housing, and location within an easy commuting distance for work. When neighbors remain strangers oldtimers cannot predict what they will do or think. In addition, newcomer suspicions are raised by the perception of their lower class relative to oldtimers, and negative stereotypes about the unknown (e.g. that newcomers must be drug dealers). The more transient newcomers keep its population stable. But as a whole the population is more mobile as even non-farming oldtimers find work elsewhere (approximately half the local population works outside town). Increasingly traditional norms of reciprocity (one gives now but expects a return later), basic to a sense of trust in neighbors, are no longer effective.

These above three factors, critical to a sense of community but in decline, are reweaving this small-town’s social fabric. Because it is typical of rural Midwestern communities, Farmington’s changes reflect a transformation of rural society more generally. The sense of community that to date made Farmington a tight-knit, good place to live for farmers and non-farmers alike, is endangered as farming becomes more concentrated, industrialized, and more local farmland is controlled by non-farmers, and non-locals.

The regional trends documented for the Farmington farmland market tend to benefit the larger farmers and landlords at the expense of mid-sized operators, who were always central to the vitality of community life. Similarly, operator decision-making premised on the view that “bigger is better” inhibits farmers choosing viable production alternatives (e.g. organic or specialty crops) that allow survival on 700 acres or smaller. Today, those who do not get bigger are being forced out and those still farming in the mid-sized category live under constant stress. Together these trends spur farm concentration and as a consequence, fewer farm families living in Farmington. The fierce competition for land in the marketplace (driven by the uniform goal of bigger is better) has the unintended consequence of diminished trust and neighborliness among farmers. The diminished trust and sense of obligation for neighbors contribute to farmers distancing themselves from the obligations of community life.

As farmers judge their town to be a bedroom community, they see less possibility of getting a return from making a substantial investment in community service. Farm families, like the non-local players in the farmland market are withdrawing from civic engagement without any social censure or economic cost. Therefore, Farmington in the coming decade is likely to become more a loosely-knit suburban or bedroom community, in contrast to its character of a tight-knit, trustful, and loyal agrarian community of its recent past.