More farmers are declaring bankruptcy as coronavirus upends industry
More farmers are declaring bankruptcy, despite a $7 billion injection from the Department of Agriculture to mitigate losses caused by the coronavirus pandemic, the Wall Street Journal reports.
Why it matters: Farmers found themselves at the center of industries hardest-hit by the crisis as the pandemic slashed commodity values, cut off supply chains and closed markets around the globe.
By the numbers: 8% more farmers filed for bankruptcy in the 12-month period ending June 30 than last year. Chapter 12 bankruptcies have been gradually increasing since 2016.
- 580 farmers declared bankruptcy in the last 12 months, while 535 did the same in the period ending in 2019.
- Hog farmers have lost almost $5 billion in potential and actual profits for 2020, per data from the National Pork Producers Council.
- Agricultural firms in California could lose as much as $8.6 billion, per a study commissioned by the state's Farm Bureau Federation.
What's next: The Trump administration is expected pay farmers a record $33 billion this year, per the University of Missouri’s Food and Agricultural Policy Research Institute.
- If more aid isn't extended to farmers after coronavirus relief expires at the end of the year, farm income is forecast to fall by 12% in 2021, per the Food and Agricultural Policy Research Institute.