Farms.com Home   Ag Industry News

Ag economist unsurprised by farm bankruptcy stats

Ag economist unsurprised by farm bankruptcy stats

More than 500 farmers filed for Chapter 12 bankruptcy over a one-year period

By Diego Flammini
Staff Writer
Farms.com

The American Farm Bureau’s chief economist isn’t shocked that the number of farmers filing for Chapter 12 bankruptcy has risen again.

Between September 2018 and 2019, 580 farmers filed for Chapter 12 bankruptcy, data from U.S. Courts says. That number is the highest since 2011, when 676 farmers filed for bankruptcy.

Given America’s ag economics, seeing these bankruptcy figures rise makes sense, said John Newton.

“We’ve had a tough time in the farm economy the last few years,” he told Farms.com. “It’s not an alarming trend, but it’s one that is moving in the wrong direction.”

Low commodity prices play a key factor in a farm’s financial stability.

Almost 50 farms in Wisconsin, for example, filed for Chapter 12 between September 2018 and 2019.

“I think that’s primarily due to the low milk prices we’ve seen since 2014 and 2015,” Newton said. “The trade war lowered commodity prices and increased (market) variability.”

In November 2014, U.S. dairy producers could earn around US$23 per hundredweight. As of September 2019, that price had dropped to around US$19.30 per hundredweight.

Multiple factors could help the bankruptcy figures decline.

The financial assistance packages the Trump administration announced for the past two years helps some, “but not all farmers were eligible for trade aid,” Newton said.

Creating more opportunities for U.S. farm products is a surefire way to ensure farm finances are stable.

“Getting trade deals done will help chart a better path forward for U.S. farmers,” Newton said. “USMCA needs to get voted on by Congress. We need to get the Japan deal implemented and move forward with China and address the challenged our economies have.

“Then we need to knock on doors around the world and find new customers. American farmers are going to continue to be productive, so it’s important to find new markets for the future economic prosperity of our industry.”


Trending Video

USDA Shock/Surprises Markets in August Crop Report + Houston we have a problem in Ontario!

Video: USDA Shock/Surprises Markets in August Crop Report + Houston we have a problem in Ontario!


USDA August crop report shocked with higher U.S. crop yields and big changes in acres, but will diseases like Southern Rust in corn especially in Iowa take away?
If Trump gave China the AI chips it wanted, does China finally step in to buy U.S. soybeans and does Trump have a Phase 2 trade deal in his pocket for the Apec Summit when he meets Xi at the end of October?
Soybean futures rallied 68 cents the pendulum is swinging back to the upside as heat could shave the soybean yield for the 2nd half of August. Midway through the 2025 10th Annual Great ON Yield Tour, we have a problem as Central Ontario is a train wreck from a severe drought.
75% of the 700 wildfires in Canada remain out of control plus Canadian Prairie farmers took another one for the team as China slaps a 75.8% tariff on canola just in time for the 2025 harvest. Western Canadian rains too late for most.
U.S. pork cutout values remain resilient.
Does Trump have a Ukraine/Russian peace deal in his back pocket in Alaska?