U.S. farm bankruptcies jumped sharply in 2025, highlighting the growing financial strain on producers amid weak commodity prices, rising costs, and mounting debt.
According to an American Farm Bureau Federation market intel article this week, Chapter 12 farm bankruptcies rose for the second consecutive year in 2025, climbing 46% from 2024 to reach 315 filings. U.S. farm bankruptcies had moved lower for four straight years before turning higher in 2024. The most recent farm bureau data shows the worst year for farm bankruptcies was 2010 at 723 filings.
By region, the Midwest and Southeast were hit hardest in 2025, filing 121 and 105 cases respectively — increases of 70% in the Midwest and 69% in the Southeast. Deep crop losses in key commodities across both regions have compounded after years of declining receipts and rising expenses. Rice producers, for example, are expected to lose more than $200 /acre even after supplemental assistance. Arkansas, the nation’s leading rice-producing state, recorded 33 filings — more than double 2024 levels and the highest in the state this century. Georgia followed with 27 filings, up 145%, while Texas, Louisiana and Florida also posted double-digit cases, the farm bureau analysis showed.
In the Midwest, heavy losses in principal row crops combined with weakening dairy, hog and poultry markets drove filings higher. Iowa, Wisconsin, Minnesota, Missouri and Nebraska all reported sharp year-over-year increases.
Farm bankruptcies are considered a lagging indicator, typically rising after prolonged financial stress. Recent forecasts confirm continued pressure, with significant crop losses expected again this year and tightening margins in livestock. The Federal Reserve Bank of Kansas City reports farmers are taking on larger operating loans and extending repayment periods. Meanwhile, USDA projects total farm debt will rise 5.2% to a record $624.7 billion in 2026.
Yet Chapter 12 protections are not available to all farms. Producers must earn the majority of their income from farming to qualify. As more families rely on off-farm employment to secure benefits and stabilize income, many are disqualified from filing, leaving some with few options beyond selling land, scaling back or closing altogether.
More than 160,000 farms have shut down in the U.S. between 2017 and 2024, the farm bureau said.
