Analyzing the Expansion Abilities of Mid-Sizes Farms in Texas Southern High Plains
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Expansion may be a viable alternative to mid-sized farms facing increased uncertainty from the elimination of traditional farm program payments. Financial and production results from 1995-1997 are analyzed for two mid-sized farmers on the Texas Southern High Plains, and each producer’s expansion ability is discussed. Results from 1995 and 1996 indicated that Farmer 1 was in a strong financial and efficiency position and could expand, while expansion was not recommended for Farmer 2 due to higher costs and lower revenues. Although both producers expanded efficiently in 1997, Farmer 1 remained in a much more desirable long-run economic condition than Farmer 2.