My children and I own two small farms in the Omaha area. Like millions of other small farms, ours have been losing money for years.
According to the USDA, 93 percent of small farms bring in less than $1m per year. This amounts to just 36 percent of the U.S. total gross cash farm income. The bigger farms, the other 7 percent, earn over 64 percent of the total gross income. Why the big income difference?
Because the income for commodity markets (corn and beans, etc.) plus local food sales has never been enough to increase land ownership rates among small farmers. Although there are exceptions, grants and loans have not helped. In fact, most small farmers need side jobs just to stay in business (ERS, USDA, charts 7 and 8).
To turn this around, small farmers need lower operating costs and far better markets. We must deal with both problems at the same time and do so without selling land or adding more debt at the farm level.
Our solution requires carefully planned cooperation among local landowners, farmers, and investors. We also need city and county governments to help with public and investor education.
To increase landownership rates among small producers, I am inviting retired farmland owners, experienced farmers, and local investors to work with my company to, 1) Organize efficient regenerative and organic production units, 2) Contract with commodity buyers, and 3) Conduct preliminary market research for farmer-owned retail food brands.
Production Units
Production units are groups of contiguous and nearby farms, leased with purchase options, to a farmer selected by the landowners.
For interested landowners we will prepare a preliminary business plan for each potential production units. This plan will include capital, operating costs, and income estimates for each farm along with capital, operating, and marketing costs with income estimates for the production unit.
Production units are strictly service companies. Except as explained below, they will not own or lease farms. They are limited to organizing production units, selecting their farm/market manager, and approving business plans.
Cooperative Marketing
To improve farm incomes, production units that are close together will pool their field crops, beef, and fresh produce from commodity buyers and for retail product and market research. Our company will provide market information, accounting, and audit trail services to the pool, to each production unit, and to each landowner.
Production Unit Goals
Our goal is to organize a number of production units in the Omaha with the capacity to negotiate better contracts with commodity buyers and with local food processors. We need processors before we can start building farmer-owned retail food brands.
The goals for these brands are to, 1) Increase household incomes from farming, 2) Earn enough to keep farmland in the hands of experienced farm families for generation after generation, and 3) Support farmland transition and continued land ownership within farming communities.
Unmanaged Consolidation
As it is now, unmanaged consolidation and speculation have driven up land prices and turned millions of farmers into low paid farmhands. However, big farmers and food companies are not the cause of small farm failures.
Smaller farms are unprofitable (ours included) because the owners and operators lack retail market access. Lower costs, more volume, and better commodity prices, will set the stage for profitable farmer-owned retail food brands. Without extensive local consumer support, smaller farmers will continue to go out of business.
How We Will Make Money
Our company’s income will be based on a negotiated share of increased net profits from commodity and retail sales. We will not accept fees for real estate transactions and farm management services, or payments from vendors, lenders, and investors.
Unmanaged Consolidation
As it is now, unmanaged consolidation and speculation have driven up land prices and turned millions of farmers into low paid farmhands. However, big farmers and food companies are not the cause of small farm failures.
Smaller farms are unprofitable (ours included) because the owners and operators lack retail market access. Lower costs, more volume, and better commodity prices, will set the stage for profitable farmer-onwed retail food brands. Without extensive local consumer support, smaller farmers will contunie to go out of business.
Preliminary Business Plans
Because of differing soil conditions and capital costs, each farm will have its own preliminary and final plans. Farm plans will be proprietary and available only to participating farmland owners.
To help ensure a stable land base for unit operators and a steady income for farmland owners, our preliminary and final business plans will include cost and income projections based on five-to-seven-year leases tied to prevailing market prices indexed for inflation.
Business plans will include estimated savings from lower chemical, irrigation, equipment, and labor inputs. Lower unit costs and more volume will position production units to negotiate better forward contracts for crops, livestock, and fresh produce. Our preliminary plans will be based in part on informal contract discussions with buyers of conventional and specialty crops, livestock and fresh produce.
To avoid long-term dependence on commodity markets, these plans will also outline product and market research projects for food ingredients and finished foods that can be sold under farmer-owned brands to food manufacturers and to retail grocery customers in the Omaha area
Without landowner consensus on the preliminary business plans, the production unit cannot be organized.
More Young Farmers
For those who say, “wait a minute, combining farms means fewer farms and fewer farmers.” That’s true if production unit farm managers raise only corn and beans.
But diversification within and across production units is essential to support a variety of specialty grains, fresh produce, and beef for high-valve commodity buyers and nearby urban consumers. All this will require many more farmers with specialized skills in regenerative and organic production and retail marketing.
Our production units will help experienced and young farmers increase ownership rates by increasing farm profits and household incomes from farming. This new money will come from production unit economies, regenerative and organic farming methods, and from better upstream sales.
Production Unit Marketing Strategy
In the early going, our marketing stratgy will focus is on larger and better commodity contracts and on applied market research, as discussed above.
This work includes building relationships with local and regional food processors who are interested in working for farmer-owned retail brands.
Without these new income streams, farmers must continue to sell land to fund retirement, pay off debt, and settle estates. Unmanged consolidation break local ownership chains and blocks essential product and market development work that underpins farm new profits, retained earnings, and better household incomes from farming.
Selecting Production Unit Farm Managers
Once preliminary business plans are approved, our partners will invite experienced farmers to discuss production unit management and marketing. Interested producers will receive business plan summaries for their farms and for the production unit. Each farm plan will be proprietory and available only to landowners. My business partners and I will review qualifications and recommend applicants to the landowners.
Incorporating Smaller Farms
Farms must be incorporated to keep local ownership chains intact from generation to generation. Production units will also be incorporated.
Briefly, incorporating family farms, 1) Helps landowners decide who will run the farm, 2) Creates rules on distributing farm profits to operating and non-operating family members, and 3) Requires shareholders to decide who will represent the farm corporation on the production unit board of directors.
Production unit bylaws will govern how the unit operator is selected and define the duties of the operator and board members. The bylaws will also govern how multiple production units work together to compete in commodity and retail markets.
Our company does not provide legal services to landowners and farmers. We support local attorneys. lenders, and financial advisors with suggested legal and financial structures that can be refined as needed. These professional services are a critical part of maintaining family farm ownership within experienced farm families and farm communities.
Local Risk Capital
With preliminary business plans in hand and with our support, landowners and production unit managers will host public meetings to attract trusted local investors. These meetings will be followed by private meetings with each landowner and family to evaluate the results of public meetings. The family meeting will include legal and financial advisors.
With sufficient investor interest, preliminary business plans will be refined prior to contract negotiations. These negotiations will include landowners and farmers (with their local advisors) along with commodity buyers, direct sellers, and of course, investors.
Since landowner-controlled production units are a new concept in agriculture, we will not ask landowners and farmers to pay for our planning services, as described above.
Community Economic Development
We are asking city and county governments in the Omaha area to cover our out-of-pocket costs for production unit planning as described above.
Page two on this website explains our marketing program in more detail.
Page 3 summarizes my qualifications, introduces my business partners, and outlines my family history in farming.
Please contact me for an appointment.
Jim Steffen, President
Massena Corporation
402-317-2639
jim@massenafarms.com
Revised: 06-24-2026