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Small and Large Crop Farm Profit Gap Narrows

Crop operators of every size are posting similar margins, though larger farms still turn their assets over faster.

Updated on Nov. 2, 2026 in Agriculture

Bold flat-color editorial illustration of two grain bins of different heights on open farmland, the taller bin casting a longer shadow, in deep red and cream.
Farms of all sizes are posting near-identical operating margins of about 20 percent, though larger crop operations still turn over their assets faster, according to a FINBIN analysis by Purdue's Michael Langemeier. AI Illustration. Upload story photo >

A FINBIN analysis of 2007 to 2025 farm data found that financial performance gaps between small and large crop farms are narrowing. Operating profit margins were nearly identical across farm sizes at about 20%, though the largest farms still post stronger asset turnover.

Why it matters

For crop operators, the study suggests that scale alone is not driving profitability differences, which bears on decisions about expansion versus staying at current acreage. Asset turnover, which measures how efficiently assets generate revenue, remains the main area where larger operations pull ahead.

Average asset turnover was 35.2% for crop farms over 2,000 acres compared with 22.3% for those under 500 acres, and the gap has narrowed over the 2007 to 2025 period. Operating profit margins averaged about 20% across both groups.

The players

University of Minnesota

A public research university that developed and maintains the FINBIN farm financial and production database.

Purdue University

A public research university whose agricultural economics program employs lead researcher Michael Langemeier.

Michael Langemeier

A Purdue agricultural economist who conducted the FINBIN analysis of crop farm finances.

The details

The study compared small crop operations with fewer than 500 acres against large operations with more than 2,000 acres using farm-level data from FINBIN, a database developed and maintained by the University of Minnesota. Asset turnover measures how much revenue a farm generates relative to the value of its assets, so a higher figure indicates that equipment, land, and other holdings are being put to more productive use. Profitability and growth in net worth showed little difference between the two size groups. Researcher Michael Langemeier of Purdue University conducted the analysis.

Timeline

  1. 2007 to 2025: period of FINBIN data analyzed in the study.

  2. November 1, 2026: analysis published by Hoosier Ag Today.

Market Landscape

The FINBIN benchmark series gives operators a long-running comparison of farm finances by size, rather than a single-year snapshot. The narrowing gap suggests that smaller crop operations are keeping pace on profitability while larger ones retain an efficiency edge in asset use.

Crop operators weighing expansion should compare their own asset turnover against benchmarks rather than assuming larger acreage automatically yields higher profit margins. Lenders and advisors reviewing a farm's financial position should look closely at how efficiently its assets are being used.

The takeaway

The narrowing gap suggests that scale is becoming less of a determinant of profitability, so asset efficiency is the metric to track closely in your own operation. Watch for the forthcoming FINBIN labor and machinery benchmarks, which will show whether those costs explain the remaining differences.

Further reading

For more on how farm finances are tracked and compared across the sector, see the Agriculture section.

Source note: This article includes information reported by Hoosier Ag Today.