By John Lovett
A dashboard tracking agricultural bankruptcy filings is providing a more complete picture of the agricultural sector by capturing bankruptcy filings under both Chapter 11 and Chapter 12.
The data can help identify changes over time, geographic patterns and emerging financial challenges affecting agricultural operations.
Historically, farms filing for bankruptcy have been tracked through Chapter 12 filings, which is specifically designed for family farmers and fishermen with regular annual income. It provides eligible farms with a process for reorganizing debt while continuing to operate.
However, Chapter 11 bankruptcy filings are also made by family farmers and fishermen. Often called the “reorganization chapter,” Chapter 11 allows corporations, partnerships and some individuals to reorganize without having to liquidate all assets.
The Data on Economic and Bankruptcy Trends in Agriculture project, or DEBT, was launched by the National Agricultural Law Center and the National Association of State Departments of Agriculture to provide a more comprehensive view of bankruptcy trends across the agricultural sector.
Of the 1,401 agricultural bankruptcy filings mapped, about 14 percent, or 201 bankruptcies, were filed under Chapter 11. All 1,200 Chapter 12 filings were counted because only farmers and fishermen are eligible to file under that chapter.
Source : uada.edu