Most farmers will not stay in business long enough to pass profitable farms on to the next generation within their families or communities. This page explains the need for change and then introduces “production units” as a low-cost way to increase farm profits, and most importantly, household incomes from farming.
The Need for Change
USDA research defines small farms as those that make less than $350 thousand dollars per year in gross cash farm income. Small farms make up 86 percent of U.S. farms. At 6 percent of all farms, medium-size farms earn less than $1 million dollars a year. Together, they earn just 35 percent of our nation’s GCFI. Larger farms make up just 8 percent of U.S. farms but earn 65 percent of our GCFI.
This is certainly not news to farmers. As long as the lion’s share of GCFI income goes to low-cost producers, smaller, less efficient farmers will continue to go out of business. Currently, the only way that small producers can stay in business is by renting more land, going into debt to buy land and equipment, and by working long hours just to cover the notes. To pay for household expenses like health insurances and kid’s education, these farmers and their families work off-farm jobs.
Obviously, this sweat equity strategy has not worked, as evidenced by the long-term decline in the number of profitable owner-operated farms. If owner operators and their communities are to survive, we need a new business model.
To increase farm size and household incomes, without more debt, I am testing a “production unit” business model on two farms that we own near Omaha.
Our Farms
We own a 78-acre place near Bennington, Nebraska (60 farmable) and 320-acres south of Massena, Iowa (270 farmable). Both farms are in permanent pasture and rented to experienced beef cow-calf producers.
However, given today’s market conditions, these farms do not make enough to maintain paddock fencing, ponds, and soil fertility. Nor do they contribute to our household income. We need more land to produce our own hay and grain.
Production Unit Demonstration Projects
To increase production, farm profits, and household incomes, I am inviting our Nebraska and Iowa neighbors to form “regenerative production units” around our two farms. A production unit is a group of contiguous and nearby farms leased to an experienced farmer selected by the landowners.
To avoid going into debt, we intend to take on local investors – people that we know and trust. In return for a share of the future profits from regenerative, organic, and other specialty markets, these minority investors will help us with on-farm capital expenses and allow us to pay competitive lease rates to our production unit landowners. These investors will join our board of directors as non-voting advisors. Local investors might also back the farmers who manage these two production units.
Pages 2 through 4 on this website explain the details of our business model. My family’s farming history along with the qualifications of our business partners are shown on page 5.
I would appreciate an opportunity to explain our business model and services to interested landowners, church and civic organizations, and local elected officials in the Omaha area.
Thank you.
Jim Steffen, President
Massena Corporation
402-317-2639
jim@massenafarms.com
Posted 10-01-2025