When you drive through eastern Arkansas in late winter, the quietness between the towns is the first thing you notice. Mile after mile of gray, level rice fields with levees still retaining water from the previous harvest. It sounds good to hear that the grain bins are full—until you speak with the owners. Prices won’t change. The operating loan from last spring is still accruing interest. And a family that has been cultivating the same land since the Eisenhower administration is filing a Chapter 12 petition somewhere in a county courthouse.
In 2025, 315 of those petitions appeared on the federal docket. That represents a 46% increase from the previous year and the second year in a row. The trajectory is what worries those who watch this for a living, even though the number itself is not disastrous by historical standards—the 1980s saw far worse. Speaking with agricultural economists at the moment gives me the impression that the worst of this is still to come. It’s up ahead.
| Indicator | Detail |
|---|---|
| Total Chapter 12 farm bankruptcies in 2025 | 315 filings, up 46% year-over-year |
| Projected total U.S. farm debt (2026) | $624.7 billion — an all-time record |
| Net farm income vs. 2022 record | Down roughly $48 billion, or 24% |
| Hardest-hit regions | Midwest (121 filings) and Southeast (105 filings) |
| State leading filings | Arkansas (33), the most in the 21st century |
| Farms closed since 2017 | More than 160,000 |
| Per-acre rice losses (2026 outlook) | Over $200, even after federal assistance |
| Primary tracking authority | American Farm Bureau Federation Market Intel |
| Historical comparison | Severity not seen since the 1980s farm crisis |
The exact cause of it is not mysterious, but it is obstinately difficult to resolve. Corn, soybean, and wheat commodity prices have returned to levels last observed in 2018 and 2019. Fertilizer, diesel, seed, and the entire costly planting process are examples of input costs that have not decreased. Interest rates are at their highest point in ten years. Additionally, the Farm Bill, which is meant to act as a safety net, has been in legislative purgatory for so long that ad hoc assistance is now the standard rather than the exception. By 2026, the total amount of farm debt is expected to reach $624.7 billion. No one in agriculture is celebrating that record, which is an all-time high.
The geographic concentration has a narrative of its own. Over two-thirds of all 2025 filings came from the Midwest and the Southeast. With 33 cases, Arkansas, the nation’s largest producer of rice, topped the list. Georgia came next with 27, a 145% increase over the prior year. Filings in Wisconsin increased by 700%. Florida increased threefold. Iowa increased by more than three times. It’s difficult not to get the impression that something structural is breaking as you watch these numbers come in, county by county; that this is a slower, deeper accumulation rather than a year of bad weather or a single commodity glut.
In discussions with extension economists, one particular detail keeps coming up. Chapter 12 is frequently completely ineligible for family farms that rely on off-farm revenue, such as a son operating a truck or a spouse working at the school. The farm itself must provide the majority of the household’s income. Therefore, even though the bankruptcy statistics are concerning, they most likely understate the actual harm. Not all farms are filing. They’re about to close. Since 2017, over 160,000 have closed, and the majority of those exits were never recorded in any court database.
Lenders are beginning to prepare. Agricultural creditors were recently advised by the legal firm Adams & Reese to audit their loan files before the next wave of defaults arrives. When things are stable, no memo of that type is written. Bankruptcy is what economists refer to as a lagging indicator—the filings continue even after conditions improve—but the situation may change if commodity prices stabilize and tariff frictions lessen. This has been referred to as a generational downturn by the American Farm Bureau. Farmers in their sixties who witnessed their parents’ surgeries as children in the 1980s say it feels familiar in ways they hoped would never happen again.
