How tough is the economy is for American farmers? Watch the canary in the coalmine: first-generation producers.
“The absolute most vulnerable farmers right now are the first-generation guys who operate on an old model,” says producer Adam Lasch. “If you’re all in on two crops, I believe you know the wolf is at the door. And he is.”
Lasch, a first-generation Wisconsin farmer, offers a candid assessment of the current agricultural plight, pointing the bone at cause, effect and opportunity.
“I don’t know which way this thing is gonna go,” he adds, “but we’re about to hit a come-to-Jesus moment.”
The Line Always Goes Up
In the gentle hills of Walworth County, Wis., a jump north of the Illinois line, Lasch, 40, runs a highly diversified first-generation livestock and row crop farm alongside his wife, Betsy, and their two sons, Boone and Rhett. By necessity, Lasch keeps a finger in a host of agriculture pies.
His baseline: We don’t have to make $100,000 on one thing. We can make $1,000 on 100 things.
“I have a unique perspective, because when I got started I never got pigeonholed in any one enterprise,” Lasch says. “I was always behind in everything, so I had to figure out how to see the layout of the land. I couldn’t ride $7 corn, and I couldn’t fit in a multigenerational system. There was one path for me: Make a new system and refine it nonstop.”
Lasch doesn’t shy from stirring the pot over a multiyear farm crisis.
“A long-term agriculture fix means USDA should stop distorting the grain market,” he says. “Quit picking grain farmers over everybody else. That is the base layer in ag right now that everyone pays for. The current ag system is a monolith, and it’s geared toward corn and soybean production in Iowa, Illinois and Indiana. All over the country, we’ve distorted the natural advantage of every acre by trying to make them all line up under the same standard.”
The wheels are turning on major upheaval, Lasch posits. “Let’s say you are 65. What have you learned over the past 25 to 30 years? That the line always goes up; that things only appreciate. The land you bought for $2,000 an acre in the late 90s is now worth four times that. That’s over, in my opinion. A rollover is happening as we speak, but that reality hasn’t hit everybody just yet. It will.”
Vinegar and Honey
More American farmers, 1.3 million, are over 65 than those under 55. The telltale statistic might suggest a demographic day of reckoning.
The eventual exit of 65-plus farmers will herald a massive transfer of wealth, possibly the biggest in farming history, Lasch contends: “Get ready. It’ll be a tsunami of change, and there’s no stopping it.”
If so, who will buy the assets, and how will they be transferred?
The tea leaves haven’t settled.
“I struggle with an answer,” Lasch admits. “Does the government keep these policies in place to keep asset prices elevated? Because that puts you on a different path than if the asset prices fall. If asset prices maintain high, it’ll be big banks and outside investors, because they know there’ll be a floor under their investment. If asset prices fall across the board, there’s a good chance you will see it getting traded to young guys looking to get in.”
Lasch doesn’t mince words. At present, agriculture is a no-go zone for first-generation farmers. Simply, new guys are exit liquidity for old guys.
“The Big Beautiful Bill (OBBB) is a recipe to keep spinning our wheels,” Lasch says. “And bailout money that comes this winter is a geriatric retirement payment.”
“I’m not optimistic in the short-term because the OBBB codified all the market distortions that led us to this point,” Lasch adds. “The way demographics currently are, older farmers will further be insulated from normal market signals, meaning they will continue to put a floor under land and input prices because they have the equity, risk mitigation and financial resources that the young do not.”
Despite a heavy lashing of vinegar, Lasch concludes with honey.
“There’s prolonged pain to come, and it’s gonna be ugly,” he says. “Survive now and prepare for later because once the dust settles, and I believe that starts in four to five years, there’s going to be genuine opportunity and lots of it.”
Unshakable
In the present, how can an enterprising young producer squeeze success from the current downturn? Lasch digs in on four points of emphasis:
1. Cut back on living expenses to pay down the debt required to get started. “Most people aren’t willing to be as extreme as we have.”
2. Get creative with building or fixing lower-value equipment purchased relatively cheaply. “Make do. There are deals to be had.”
3. Grit. Work harder than everyone else and then some. There is a path for the frugal. “Our industry promotion groups like to show the fifth-generation family standing in front of a shiny multimillion-dollar piece of equipment or a drone shot of a gigantic grain setup because it somehow shows the success of the policies they promote. I’m not saying they haven’t worked hard to get where they are, but the things that made them successful will be different going forward. We should be highlighting the young guy underneath the shade tree with his $8,000 chore tractor getting its starter replaced, because he doesn’t have a $500,000 new shop.”
4. Unshakable faith in God. “I have no idea how everything worked out as it has, but we’re nothing without him.”
In conclusion, Lasch punctuates his position on the effort required of young farmers.
“An attitude of immense strength to make things work while everyone else is resting on their laurels and has gotten lazy because of asset appreciation, decades of equity and favorable ag policies paving the way,” he says. “The young people are out there; let’s find them and give them a hand-up, not just a handout.”
For more from Chris Bennett (@ChrisBennettMS or cbennett@farmjournal.com or 662-592-1106), see:
Family Farm Wins Historic Case After Feds Violate Constitution and Ruin Business
How the Deep State Tried, and Failed, to Crush an American Farmer
Corn and Cocaine: Roger Reaves and the Most Incredible Farm Story Never Told
Ghost Cattle: $650M Ponzi Rocks Livestock Industry, Money Still Missing
Sisters of Farm Fraud: How 4 Siblings Fleeced USDA for $10M
Game of Horns: Iowa Poacher’s Antler Addiction Leads to Historic Bust
