Farm bankruptcies are on the rise in the Upper Midwest, according to a new report from the Federal Reserve, doubling from their recent lows in 2014.
At least 84 farms filed for bankruptcy from June 2017 to June 2018 in Wisconsin, Minnesota, Montana, and North and South Dakota, according to analysis from the Federal Reserve Bank of Minneapolis.
The report released earlier this month shows that over the same time period in 2014, 32 farms filed for bankruptcy.
The numbers have increased steadily since then, with 46 bankruptcies reported in 2015, 60 bankruptcies reported in 2016 and 67 reported in 2017.
In 2010, 70 bankruptcies were reported in the five states, but that was following the financial collapse of 2008–2009 and a brutal recession.
Some experts fear the worst is yet to come amid falling commodity prices and the Trump administration’s battles with China and other countries on trade.
“Current price levels and the trajectory of the current trends suggest that this trend has not yet seen a peak,” wrote Ron Wirtz, an analyst at the Minneapolis Federal Reserve Bank.
More than 60 percent of the reported bankruptcy filings for the region were in Wisconsin, which could suggest a large number of dairy farm bankruptcies. Wisconsin is the country’s second largest producer of milk.
Depressed prices on farm goods such as corn, dairy and soybeans are also likely leading to a spike in Chapter 12 filings, according to the report. China has also largely closed its market to U.S. soybeans amid the fight over trade.
Chapter 12 allows repayment of debts over as many as five years. It was set up after the farm crisis during the 1980s.
President Trump pledged $12 billion in aid for farmers impacted by global tariffs. A recent report in The New York Times found the aid had done little to help farmers, however.
Source: thehill.com
