An analysis by the American Farm Bureau Federation shows 2018 Chapter 12 family farmer and family fisherman bankruptcies nationwide were down from prior-year levels. Chapter 12 filings in 2018 totaled 498 and were down one percent, or three filings, from the 2017 calendar year, according to the AFBF Market Intel report.
AFBF notes, however, that the U.S. had fewer farmers in the U.S. in 2018 compared to 2017. And, the data shows bankruptcy filings in 19 states were higher than prior-year levels. In the Midwest, bankruptcies totaled 223 filings, up 19 percent from 2017 and double decade-ago levels. Farm bankruptcies in Wisconsin, the second largest dairy state, totaled 49 filings in 2018 – the highest in the nation.
AFBF says the situation is likely to worsen. Farm debt is record-high, and farm debt as a proportion of annual farm income is at 97 percent, a 32-year high. However, AFBF also points out that bankruptcy does not mean the loss of the family farm. Through a successful Chapter 12 bankruptcy, a farmer may have an opportunity to retain assets and continue the farm operation in some capacity.