Life cycle of a farm bankruptcy

Unforgiving weather patterns, trade disputes and low commodity prices have become the perfect storm for financial distress in the agricultural community, with family farm bankruptcies rising 23% for the 12 months from March 2019 to March 2020, compared with the previous 12 months.

The deeper story is that the annual rate is merely the most recent of five consecutive years of high Chapter 12 filings. According to a report released this year by the American Farm Bureau, the 627 Chapter 12 filings in the 12 months ending March 2020 account for the third-highest total over the last 20 years. Only 2011 and 2003 saw a higher number.

“A farming or fishing family can face rising debt for a number of reasons,” Peggy Hall, associate professor and director of the Agricultural and Resource Law Program at Ohio State University, said. “Uncontrollable factors like down markets, weather impacts, a death in the family, medical issues, and a host of unforeseen circumstances could be factors.”

To help farm families fully understand the bankruptcy option, the National Agricultural Law Center has published a bulletin series authored in partnership with Hall and her colleagues at Ohio State University Extension.

The series, titled “Facing Farm Financial Stress: An Overview of the Bankruptcy Option,” walks producers through each stage of the bankruptcy process. From first considerations, to court preparation, to recovery, the series takes a look at the entire life-cycle of a farm bankruptcy.

“It’s important to note that the 2019-2020 figures are pre-pandemic,” Harrison Pittman, director of the National Agricultural Law Center, said. “There’s little doubt that economic disruptions from COVID-19 will not help farmers already in a struggle for their lives.

“This resource will be helpful to the many farm families who have been struggling and are reviewing their options,” he said. “By covering each step of the process, this publication will help producers decide if the bankruptcy option is the right fit for their situation.”

The series can be found at

For more information on the National Agricultural Law Center, visit or follow @Nataglaw on Twitter.