Q1 2025 U.S. farm bankruptcies exceed 2024

Fast facts
Arkansas makes up more than 25 percent of Chapter 12 filings

LITTLE ROCK — Farm bankruptcy filings are rising in 2025, a sign that agriculture is facing the same high financial pressures it saw pre-pandemic, said Ryan Loy, extension economist for the University of Arkansas System Division of Agriculture.

Chapter 12 filings in the first quarter of 2025 have exceeded those in all of 2024. (Image via Pixabay(

“We’ve had 259 filings in the United States so far this year,” Loy said. “And that’s just through the first quarter of this year.

“We’ve already beat last year in terms of national filings,” he said. “Once you see  this on a national level, it’s a clear sign that financial pressures that we saw before in the 2018 and ‘19 are kind of re-emerging.”

Chapter 12

Filing under Chapter 12 of the federal bankruptcy code gives farmers and family fishermen an opportunity to propose and carry out a plan to repay all or part of their debts. In Arkansas, those seeking to reorganize under Chapter 12 would file a plan with the 8th U.S. District Court. Chapter 12, introduced in 1986 at the height of the farm crisis, was designed with farms in mind  and offers an alternative to a Chapter 7 filing, which a farm’s assets are liquidated to pay creditors.

With more than 60 farm auctions in Arkansas since December, there are plenty of Chapter 7 filings.

In 2019, there were 599 Chapter 12 filings across the U.S., which was the highest in at least the past decade. However, by 2021, that number declined to 276.

“That drop was due in part to some of that pandemic-related assistance and stronger commodity prices at that time,” Loy said.

In 2010s, Arkansas accounted for 20. To 22 percent of the Chapter 12 bankruptcy filings in the 8th U.S. District Court. By 2021, Arkansas accounted for just 5 percent of those filings.

“But now, we’ve really reversed course,” Loy said. “In 2024, Arkansas accounted for more than 30 percent of the district’s filings over the whole year. And in 2025, we’re sitting right now at 26.8 percent of those total filings — and we still have three more quarters of data to bring in.

“I would suspect that we’re going to probably outpace or at least be right on the margin of what 2024 looked like,” Loy said.

Financial pressure cooker

A large part of the pressure stems from the fact that “commodity prices are back at levels where they were in the 2018-2019 era,” said Scott Stiles, extension economics program associate for the Division of Agriculture.

Adding to the pressure cooker are input costs — seed, fertilizer, pest management tools and diesel — that never seem to decline much or for a long period.

“There are concerns about the trade environment that we’re in,” Stiles said. “There have  certainly been a lot of weather challenges.”

Stiles said the farmers’ No. 1 response is “holding off on capital purchases right now.”

The last monthly report from the Association of Equipment Manufacturers showed that tractor sales were down 13 percent year over year and combine sales were down 48 percent for the same period, Stiles said.

“There’s a downstream impact on other segments in ag industry,” Stiles said. “Your input suppliers, your equipment dealers, anybody who provides a service to farmers is impacted by this, too.”

“If the farmers are hurting, those communities are going to hurt too,” Loy said.

For a larger discussion on farm bankruptcies listen to the Morning Coffee and Ag Markets podcast: “Chapter 12 Bankruptcies in Arkansas and the U.S.: Trends and Implications for the Farm Economy.”

To learn about extension programs in Arkansas, contact your local Cooperative Extension Service agent or visit www.uaex.uada.edu. Follow us on X and Instagram at @AR_Extension. To learn more about Division of Agriculture research, visit the Arkansas Agricultural Experiment Station website: https://aaes.uada.edu/. Follow on X at @ArkAgResearch. To learn more about the Division of Agriculture, visit https://uada.edu/. Follow us on X at @AgInArk.