Farm Bankruptcies Reach New High in 2025

Chapter 12 filings climb 46% as Midwest and Southeast regions see sharp increases

Published on Feb. 11, 2026

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A new report from the American Farm Bureau Federation shows that Chapter 12 farm bankruptcies increased for the second consecutive year in 2025, reaching 315 filings - a 46% jump from 2024. The Midwest and Southeast regions were hit hardest, with 121 and 105 filings respectively. Economists say deep crop losses and years of declining receipts and rising expenses have compounded to drive more farmers to seek bankruptcy protection.

Why it matters

The rise in farm bankruptcies is a troubling sign for the overall health of the agricultural economy, with the Midwest and Southeast - major farming hubs - seeing the sharpest increases. Bankruptcy can be a last resort for farmers struggling with large debts, and the data suggests growing financial strain across the sector.

The details

The American Farm Bureau Federation's Market Intel Report found that Chapter 12 farm bankruptcies, which allow family farmers to reorganize debts, increased by 46% in 2025 to 315 filings. The Midwest led with 121 filings, followed by the Southeast with 105. Other regions saw far fewer bankruptcies. Economists point to deep crop losses across major commodities in those two regions, compounded by years of declining farm incomes and rising expenses, as key drivers pushing more farmers to seek bankruptcy protection.

  • The American Farm Bureau Federation released its report on February 11, 2026.

The players

American Farm Bureau Federation

A national organization representing the interests of American farmers and ranchers.

Samantha Ayoub

An economist with the American Farm Bureau Federation.

Federal Reserve Bank of Kansas City

A regional Federal Reserve bank that monitors economic conditions in the Midwest.

USDA

The United States Department of Agriculture, which tracks and reports on agricultural data and trends.

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What’s next

The USDA is expected to release its annual farm debt forecast in the coming months, which will provide further insight into the financial strain facing the agricultural sector.

The takeaway

The sharp rise in farm bankruptcies, particularly in the Midwest and Southeast, underscores the growing financial pressures on American farmers. As crop losses mount and expenses continue to outpace revenues, more family farms may be forced to seek bankruptcy protection to reorganize debts and stay in business.