May 27, 2021

Cropland's Relationship with Pastureland

by Sara Wensley

Director, Growth and Marketing

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Cropland's Relationship with Pastureland
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Understanding the nuances in the differences between cropland and pastureland across time ultimately provides some context for the U.S agricultural system.

In the 20th century, when nearly half of Americans were either farmers or lived in rural communities, the difference between cropland and pastureland were less distinct than they are now. Today, less than 1% of the U.S. population works in the agricultural sector and over 70% live in urban centers. As the amount of American agricultural workers has diminished, the agricultural landscape has changed dramatically.

In the early 1900s, nearly all the land in production was in small-scale production (less than 200 acres or so) and many farmers were growing crops, raising chickens and pork, and pasturing livestock. In this time, the distance between cropland and pastureland was short because livestock were part of the cropping system, and crop systems were part of livestock production.

Today, pastureland and cropland are more clearly defined. Pastureland is used to grow grazing livestock, whereas cropland is farmed land used to grow harvested crops. Much of the agricultural land in the U.S. has rotated between these land-use categories across time because of differing socio-economic and ecological conditions, federal legislation, market shifts, and technology.

Understanding the nuances in the differences between these land-use categories across time ultimately provides some context for the U.S agricultural system.

From the Farm to Town

As the century progressed, this dramatically changed as culture and technology began to shift. With the invention of the tractor, and even more important, the John Deere plow, large amounts of acreage could now be placed into row crop production. People were getting jobs “in town” because less people were needed to work the farm, and agricultural production was undergoing the largest change it had seen in 13,000 years. Efficiency became the goal and the U.S. row crop production system became the most efficient in the world.

As more and more people were able to leave the family farm, many folks headed West with the promise of free land through the Homestead Act. They were met with limited water and poor soil, especially compared to the Midwest, which has some of the world’s most fertile ground. The farming practices they knew didn’t seem to work in the arid shortgrass prairie and rangeland environments. The 160 acres farms of the Eastern half of the U.S. were profitable and viable. In the arid West, 160 acres were not productive enough to support homesteading families. When the first wave of homesteads failed to succeed as row crop operations, they were consolidated into large acreages and most became pastureland used exclusively for raising grazing animals. Areas in meadows with good water and decent soil were plowed and planted for use as hayfields or lower quality cropland.

In the mid 1900s, American culture was changing quickly. Much of the cropland and pastureland surrounding cities began to grow houses rather than livestock or crops. The Western landscape became large ranches focused on cattle production on arid land. The Western coastal region promised fertile land more water and much of it ended up planted as permanent cropland, planted with various fruits and nuts, and quickly became a major supplier of produce. As large-scale animal agriculture grew in the U.S., agricultural land east of the Mississippi became centered around a few select row crops, like corn and soy, grown for livestock feed.

The shift to growing harvested row crops to feed to livestock, rather than feeding stock on pasture, resulted in a dramatic drop in pastureland. This system, raising corn and soybeans to feed to animals in feedlot systems, is incredibly efficient and productive.

This image, courtesy of American Farmland Trust, shows the conversion of agricultural land to urban and low-density residential development between 1992 and 2012.

This map, that comes from the American Farmland Trust, shows the conversion of agricultural land to urban and low-density residential development between 1992 and 2012 along with a rating of the most productive lands in the U.S.

The Dust Bowl and Great Depression sparked a new era for American Agriculture. In 1933, the U.S. Federal government passed the first comprehensive food policy legislation. The government now offered price subsidies for row crops, managed inventory and supply of commodity crops, managed welfare food procurement, and administered private land conservation programs. Congress continues to pass similar legislation today through the U.S. farm bill.

These programs, along with forever improving technology, served as major incentives to convert pastureland to cropland, even in cases when the land is not very productive cropland, often lacking fertile soil, water, or both. This land is commonly known as marginal cropland, and if not for price support systems, it likely would remain as pasture, as it really is not in its best long-term use as cropland given its soil and water condition.

Regenerative Agriculture

Today, regenerative agriculture provides a production methodology that trades a focus on efficiency and extraction for one that matches natural systems and focuses on longer term sustainable yield. With a focus on soil health and matching natural systems, regenerative ag really isn’t anything new. It’s really a revitalization of historic agricultural systems that were focused on diversity and working with nature, rather than against it.

Technology has served to help guide us towards productive systems of cropland and pastureland and has moved us between these two land uses throughout history. From the plow, to the center pivot, to the combine, and more, technology often tends to be a double-edged sword. It can offer the promise of innovation and increased yield and the possibility for over extraction or misuse of the resource. Much of the current work of regenerative agriculture is understanding how technology, together with nature-based farming methods, can support the long-term sustainability and betterment of the industry. In fact, integrated crop and livestock operations are popular among many recent pioneers of regenerative farming.

Farmland, in general, is higher value agricultural real-estate than pastureland because of its potential to produce high value row crops and permanent crops. The homesteaders had to learn the hard way that pastureland typically does not make productive farm ground.

FarmTogether is focusing on high value, productive cropland to create opportunities for farmland investing in both row crop and permanent crop farms. Our goal is to make farmland investing accessible to those interested in the growth of sustainable food systems on highly productive agricultural land.

Interested in Learning More About Farmland as an Asset Class?

Click here to see farmland's historical performance, visit our FAQ to learn more about investing with FarmTogether, or get started today by visiting ways to invest.

Disclaimer: FarmTogether is not a registered broker-dealer, investment adviser or investment manager. FarmTogether does not provide tax, legal or investment advice. This material has been prepared for informational and educational purposes only. You should consult your own tax, legal and investment advisors before engaging in any transaction.

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