Improving Data Collection and Measurement of Complex Farms (2019) / Chapter Skim
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2 Background: USDA's National Agricultural Statistics Service and Economic Research Service
2 Background: USDA's National Agricultural Statistics Service and Economic Research Service
Pages 31-70
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From page 31... ...
publish statistics and reports that regularly and extensively detail the number of farms in the United States, the quantities and types of outputs they produce, the incomes of both farm businesses and the farm households that run them, and the status and conditions of the agricultural economy. The USDA's data collection programs entail significant investments of the agency's staff time, staff talent, and budget resources.1 Equally important, data collection is costly in terms of time and burden to survey respondents.
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From page 32... ...
Agricultural production therefore embodies not just what farmers do, but also the activities that they may hire out to separate businesses.2 Farming activities are also contracted to nonfarm firms. In addition, large corporate nonfarm businesses may also be engaged in farming.
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From page 33... ...
BACKGROUND 33 Among the publications produced by NASS are six of USDA's seven leading economic indicator reports,4 which are broadly used in agribusiness and market analyses, including for decision making by buyers and sellers of agricultural commodities. The mission of ERS is to "anticipate trends and emerging issues in agriculture, food, the environment, and rural America and to conduct high-quality, objective economic research to inform and enhance public and private decision making."5 The top-level subject areas covered by ERS include the following:6 • Agricultural economy: farm-sector performance and farm house holds' well-being; farm size and concentration; market analysis, data, and projections on commodity supply, demand, and prices; and federal farm policies • Food and nutrition: food security; food and nutrition assistance programs; food choices and health outcomes; food access and store proximity; food retailing and marketing; and food prices • Food safety: societal benefits associated with reducing food safety risks; global trade implications and economic impacts of food haz ards; and potential results of regulation versus industry decisions • Global markets and trade: domestic and international markets; trade; and the U.S.
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From page 34... ...
prepare reports of the Agricultural Statistics Board covering official state and national estimates. Additional provisions are in place to ensure data security precautions to prevent disclosure of crop or livestock report information prior to the scheduled issuance time and to avoid disclosure of confidential data or information supplied by any person, firm, partnership, corporation, or association.
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In addition to the Census of Agriculture, NASS is mandated to produce a series of reports for the following:12 • Cold Storage, which includes mandatory data collection items such as stocks of butter and stocks of cheddar cheese (Public Laws No.
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, which is jointly conducted by NASS and ERS. ARMS is the "primary source of information on the financial condition, production practices, and resource use of America's farm businesses and the economic well-being of America's farm households."22 The Food and Agriculture Act of 1977 mandated that ERS, through the Secretary of Agriculture, report annually on trends in family farms -- which ERS met primarily by collecting data from principal farm opera 18 For Peanut Processing, see: http://usda.mannlib.cornell.edu/usda/current/PeanStocPr/ PeanStocPr-12-30-2016.pdf.
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From page 37... ...
The statistics are based on responses to ARMS as well as sector-level information provided by NASS, the Farm Service Agency, the Risk Management Agency, and other administrative data sources. Data for more than 200 components of farm income are provided to BEA and used in deriving farm sector GDP and personal income both for the United States and by state.
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Currently, ARMS data, including the production expense and the "farm-related income" line items, are used. However, administrative data are also used -- from programs involving government payments (Farm Service Agency)
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CONCLUSION 2.1: The mandated responsibilities faced by the National Agricultural Statistics Service (NASS) and the Economic Research Service (ERS)
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Neither of those conditions holds true today for the majority of farm households. 2.2. DATA NEEDS AND CURRENT REPORTING Any consideration of changes to data collection should take stock of the reporting requirements faced by the USDA.
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Monthly or quarterly series provide timely information on production and prices, and some of these are considered principal economic indicators for various programs within the agency. A principal federal economic indicator is defined as a major statistical series that describes the current condition of the economy.30 Examples include the monthly Cattle on Feed report and the monthly Crop Production report.
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From page 42... ...
ERS does much of its reporting by publishing data products, often as a time series. Examples include statistics on farm household characteristics and finances, on farm business finances, on commodity costs and returns estimates, and on the adoption of genetically engineered crops.
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As time passed, the Census of Agriculture years were adjusted until the reference year coincided with the Economic Censuses covering other sectors of the nation's economy. Currently, the Census of Agriculture is conducted for years ending in "2" and "7." The Census of Agriculture also collects information on the agricultural industry that may not be gathered elsewhere in the annual survey programs conducted by NASS, covering topics such as agritourism, organic production, farmer demographics, specialized agricultural production, Internet 33 Moss, Featherstone, and Wilson (2012)
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From page 44... ...
Since the Census of Agriculture produces county estimates, such as for livestock or crop production, it also needs to attribute the agricultural production and the land of an operation to each county. ARMS and Other Key Surveys34 ARMS is an annual cross-sectional survey that collects information on farms and farm households.
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Sampled farms not producing the targeted commodity receive a more general version of the questionnaire. The sampling unit for ARMS is the operation-operator pair from the sampling frame.
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receive funding partly based on the number of farms in a particular state. However, for collecting data with the purpose of measuring the activity and output of the nation's farms, there are compelling reasons to identify farm businesses in alternative ways as well, based on how those businesses are organized.
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"Family Farm" A family farm is defined by the USDA as a farm in which "the majority of the business is owned by the operator and individuals related to the operator by blood, marriage, or adoption, including relatives that do not live in the operator household."37 The business referenced is the same as the "operation" as defined in the questionnaire; the operator is the principal operator of the farm (as defined below)
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From page 48... ...
If the operation has multiple operators, the respondent is asked to identify a principal operator; in other words, it is left to the respondent to define the principal operator. For surveys such as ARMS, ERS uses information on the principal operator to identify the household about which it will collect household demographic and financial information.
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Nonfarm income is all other income, include that from wages, nonfarm businesses, and interest and dividends received by any member of the principal operator's household. "Farm Business" ERS defines farm businesses as farms with annual gross cash farm income greater than $350,000, along with smaller operations where the principal operator has farming as his or her primary occupation.
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For example, when a farmer produces wheat that is used by a miller to produce flour that is used by a baker to produce bread that is sold to a consumer, it is important to not double-count the value of the wheat and the value of the flour if milling is not part of the farm. It is worth noting that ERS also uses the Value Added Component Series, where the concept of value added has a different use, to denote the contribution of farm production (as opposed to food 42 In some cases, an effort is made to distinguish between the farm output and the value added from nonfarm production.
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From page 51... ...
Yet some definitions give considerable flexibility to the respondent on how to report data, and this has implications for data accuracy, interpretability, and respondent burden. Several key concepts on which data collection are based are vague and left to the interpretation of respondents, including "the operation," "the principal operator," and a "separate business." Whether respondents consider (and report)
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From page 52... ...
For example, as detailed in Chapter 5, redefining the farm household population as all households that include a person who is an operator of a family farm would permit capturing information about the financial health of households in a position to succeed a principal operator in the coming years. CONCLUSION 2.2: When respondents are given a choice to decide the unit of measurement, such as which activities are included as part of the farm, who are the operators, or who is the principal operator, statistics on the number of farms, the size and scope of the farm sector, and the farm population are affected.
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From page 53... ...
In 2010, there were two primary versions of ARMS, known as the Core survey and the Cost and Returns Report. The Core survey was 16 pages long and took the average principal operator one hour and seven minutes 43 The USDA agency that imposes by far the most burden hours is the Food and Nutrition Service (FNS)
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Additionally, large, complex operations may face an increased burden if the definition of the responding unit -- that is, who should answer the questions -- is unclear. With added mandatory reporting requirements for such things as pesticide use, fertilizers, and water quality, the total respondent burden of compliance requires significant resources to manage, especially for large operations.
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Recently, even the mandatory Census of Agriculture has achieved only around an 80 percent rate.46 And roughly one-third of sampled farm operators ignore the ARMS survey entirely, an occurrence known as "unit nonresponse." This leaves a unit response rate for ARMS that is well below the 80 percent level, which triggers the OMB, which monitors all federal information collection, to require the administering agency to conduct a nonresponse bias analysis (U.S. Office of Management and Budget, 2006, p.
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From page 56... ...
by enumerators. Information on the number of acres, for example, does not always prepopulate in NASS data sets, but possibly it could be configured to do so.49 Of course, confidentiality protections are needed, but statistical agencies are increasingly finding ways to automate surveys that prepopulate previously collected data.
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And, as outlined in Chapter 5, a Farm Register that followed the accounting structure used by the farm business could also help to demarcate entities that an individual respondent could better understand. Farm operators also reported to the panel that surveys sometimes ask for data formatted in a way that does not align with the way information is recorded in their accounting or other record keeping systems.
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. One large-operation producer, who described to the panel his own complex farm operation, cited several reasons why a respondent may be reluctant to participant in NASS surveys: (i)
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Whether the higher burden of reporting on large, complex operations is a factor in response rates is a key question of interest to statistical agencies. Weber and Clay (2013)
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find that "the matched sample means for FIGURE 2.1 Response rates to ARMS, by farm size, 2012. SOURCE: Weber and Clay (2013)
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. Under this scenario, response burden accounts for 21 percent of the different response propensities between the smallest and largest farms; however, this would be an underestimate if the nonrespondent group consists disproportionately of large farm operators who anticipated that completing the questionnaire would take a long time (Weber and Clay, 2013, p.
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Impact of Burden on Data Quality Greater respondent burden can reduce data quality by reducing the willingness of farmers to respond to any questions (resulting in unit nonresponse) , or to particular questions (resulting in item nonresponse)
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Operators of complex farms in particular may find many questions inappropriate or simply unclear and become frustrated. For example, should the hired manager or the farm owner be listed as "the principal operator?
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Farm business A farm with an annual A collection of business gross cash farm income of establishments with at least one farm more than $350,000, or a establishment linked by common smaller operation where ownership or control; this includes the principal operator has cases in which one business owns farming as his primary and operates one establishment (a occupation. simple farm business)
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From page 65... ...
by the respondent in the ARMS; not used in the Census of Agriculture. Producer Replaces the term "operator." Farm household Those who share dwelling units with principal farm operators of family farms; determined by survey respondents.
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Field A continuous area of land devoted to one crop or land use, such as a farmstead, pastureland, woods, or wasteland. TERMS FOR OUTPUTS Farm Outputs/ Goods and services produced Products that fall under NAICS 111 (Crop production)
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From page 67... ...
The total number of estimated burden hours for all USDA surveys in 2017 was 211,851,887. The total number of estimated operator contacts for all USDA surveys in 2017 was 1,070,506,570.
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From page 68... ...
13,080 27,420 0535-0247 Distillers Grains Survey - 0535-0248 Generic Clearance of Survey Improvement Projects 15,000 25,000 0535-0249 Organic Production Survey 13,004 44,032 0535-0251 Residue and Biomass Field Survey 64 220 0535-0252 Wheat and Barley Scab Survey - 0535-0253 Pesticide Protection Equipment - 0535-0254 Current Agricultural Industrial Reports 4,746 15,130 0535-0255 Colony Loss Survey 7,899 53,120 0535-0256 Feral Swine Survey 6,192 19,440 0535-0257 Organic Certifier Survey 885 55 0535-0258 Cost of Pollination Survey 14,987 78,000 0535-0259 Local Food Marketing Practices Survey 28,905 131,600 TOTAL 3,577,429 17,198,228 2 - 29
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From page 69... ...
BACKGROUND 69 TABLE A2.2.2 Total Annual Responses and Burden Hours for Surveys by Three USDA Agencies, 2017 Number of Total Number of Annual Burden Dockets Annual Responses Hours Food and Nutrition Service 79 847,066,971 106,736,781 Animal and Plant Health 135 147,424,507 7,530,873 Inspection Service Food Safety and Inspection 30 52,660,413 11,469,151 Service SOURCE: National Agricultural Statistics Service.
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