Arkansas leads U.S. in farm bankruptcies as crop income falls

Arkansas farmers are selling crops for less money, paying more to grow them, and filing for bankruptcy at a higher rate than farmers in any other state. Crop cash receipts in the state are down 17.4% compared with last year, according to the Arkansas Agriculture profile. Those receipts normally account for about $20 billion a year in the state's economy.

The pressure on farm budgets comes from several directions at once. Tariffs and trade disputes closed off buyers for crops Arkansas grows, and periods of flooding followed by drought hit fields already weakened by low commodity prices. Fertilizer costs rose after Russia's assault on Ukraine, and the Iran conflict pushed diesel prices higher. Poultry growers face lawsuits and diseases that can wipe out a flock. Cattle producers deal with drought and trade problems.

The declines are not evenly spread across the state's crops. Soybean receipts fell 29.8%, cotton lint dropped 40.6%, and corn declined 17.3%, according to Frank Seo, co-author of the Arkansas Agriculture profile and assistant professor of rural development for the University of Arkansas Division of Agriculture. Receipts from animals and animal products rose 1.2%, and rice cash receipts increased 6.5%. "That overall number masks very different conditions within agriculture," Seo said.

Arkansas recorded 12 Chapter 12 farm bankruptcy filings in the third quarter of 2026, the most of any state. Iowa, the next-highest state, reported six. "So far this year, 32 agricultural operations in Arkansas have filed for Chapter 12 bankruptcy protection," said Harrison Pittman, director of the National Agricultural Law Center. Arkansas filed 33 Chapter 12 cases in 2025, more than double the prior year and more than any other state. By some estimates, close to 25% of Arkansas farms have closed in the past 18 months.

Farm bankruptcies are climbing across the country too. Federal court data cited in the University of Arkansas report shows 292 Chapter 12 cases filed so far in 2026, up nearly 19% from 246 during the first three quarters of 2025. The third quarter of 2026 saw 91 Chapter 12 filings nationwide, plus 201 farm-related cases filed under Chapter 11.