Hacker News Reader

Comment by AngryData | Hacker News Reader

Seems kind of silly, but at the same time, with the width of modern combines and tractor implements, it isn't really a big deal. The labor cost of people driving a row crop tractor or combine is barely even a blip in the cost of food. I would be surprised if this even came out represent even a single percentage of food costs for row crops.

View on HN

To further expand this out since someone wanted to throw AI trash math at this, a REALLY good year for a farmer is a 10% return on input from fertilizer, seed, and equipment maintenance, usually it isn't that high and many farms average only a 2-3% margin over time but ill stick with 10%. Current average wheat prices are 9.3 cents per pound, while the cheapest flour you can get from walmart is 48 cents per pound, so 1/5th of that.

So provided the farm makes no investments on equipment or expansion, has a great year to get near maximum possible returns and all of that ends up as payment for labor, there is zero spoilage or waste, and you buy the cheapest possible flour, 10% x 1/5th = 2% is the highest possible amount of money you can expect from your flour purchase to go towards farmer's labor. If we use more realistic averages of farm profits it drops down to 1% or less, and if you include the costs of buying and upgrading farm equipment like any successful farm has had to do to stay alive throughout the last 40 years it drops even lower.

And if you look at the amount of land that a farmer needs to own (or god forbid rent) it looks like an even shittier deal for the farmer. At the US average of 40 bushels of wheat produced per acre planted, with a price of $5.55 per bushel, you get $222 per acre. With 90% of that going towards material input costs (its actually negative return on investment at that price but lets just assume 10% margin for the farmer's sake), that is only $22.2 per acre for the farmer, so in order for a farmer to earn $60,000 per year at that rate, they would need to farm about 2,700 acres of wheat, thats over 4 square miles. If we drop to only 5% margins, which is still better than most farms would ever expect, thats about 9 square miles of wheat they have to work. And you can double that again if you go for the more realistic expected margins of 2-3 percent. So unless you have a full 4 mile x 4 mile block of arable land, plus all the equipment needed to farm it, you couldn't really survive off anything less than a 4 mile sided square of wheat planting.

The problem isn't so much an issue of cost of labor, but the ever-present situation that the abled bodies, who by and large live in cities, have this idea that there isn't any work in rural areas. There aren't usually strong social ties between regions to make introductions and when one is searching for a job, nobody is trawling the jobs sites with "Find me a job in the middle of nowhere" over "Find me a job in <insert city name>". Meaning that connecting with someone to do the work is a huge challenge.

Of course, there is a strong case to be made that if you can't find enough people to help, you've simply bit off more than you can chew and that it is time to scale back your operation.

Yeah, the labor cost of food has been a blip for a long time. The claims that grocery bills would triple if we paid Americans enough to work the fields are just agitprop from Big Ag processors. In reality the bump would range from something like a high of 10% for labor-intensive foods like fresh strawberries, down to 1% or less for grain foods like cereal.

Also, whenever headlines say "Farmers [something]," they're not talking about actual farmers. They're talking about farm organizations like Farm Bureau that claim to speak for farmers but really speak for the ag industry.

You have one guy in the 'master' cab, and several other harvesters following in convoy diagonally behind it. So the single (hands off) 'driver' is running a whole fleet of these.

Reply on news.ycombinator.com