Farm Bankruptcies Decline Despite Tough Farm Economy
It’s no secret that things are tough in farm country right now. It seems that every week there is news of a farm going out of business. However, research from the American Farm Bureau Federation (AFBF) actually shows there have been fewer farm bankruptcies this year than there were in 2017.
“Based on caseload statistics from the United States Courts database, Chapter 12 bankruptcy filings decreased in the first half of 2018 compared to the first half of 2017,” explains Megan Nelson, an economic analyst with AFBF. “From January to June 2018, family farmer and family fisherman Chapter 12 filings totaled 251 cases, down 26 cases or 9% from 277 filings during the first half of 2017.”
According to Nelson, the decline in bankruptcies contradicts prior expectations for bankruptcy acceleration in 2018. But it falls in line with USDA’s previous projections for inflation adjusted 2018 farm equity and debt to remain flat.
This year, Chapter 12 bankruptcy filings were the highest in Wisconsin, at 26, followed by Georgia, Kansas and Nebraska at 16 each.
Year-over-year, Georgia saw the largest decline in bankruptcies, followed by Michigan and Wyoming. Not surprisingly, New York, which has seen dozens of dairies go out of business this year saw the largest increase in bankruptcy filings.