Chapter 12 farm bankruptcy filings up significantly in Q3; Arkansas leads nation
Oct. 22, 2026
By Mary Hightower
University of Arkansas Division of Agriculture
Fast facts
- Arkansas continues to lead U.S. in bankruptcy filings
- Pittman: ‘The number of Chapter 12 bankruptcies filed this quarter underscores the significant financial pressures facing U.S. agriculture’
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FAYETTEVILLE, Ark. — Arkansas led the nation in Chapter 12 bankruptcy filings in the third quarter of 2026, its 12 cases reflective of the difficult economic conditions in agriculture, according to data released by the federal courts.
“That number is twice the six filings reported in Iowa, the next-highest state,” said Harrison Pittman, director of the National Agricultural Law Center. “So far this year, 32 agricultural operations in Arkansas have filed for Chapter 12 bankruptcy protection, highlighting the financial challenges facing the state’s agricultural sector.”
>Nationwide, Chapter 12 bankruptcy filings are also up significantly. According to federal court data, 292 Chapter 12 cases have been filed so far in 2026, nearly 19 percent more than the 246 filed during the first three quarters of 2025. In the third quarter alone, 91 Chapter 12 bankruptcy filings were recorded nationwide.
Chapters of the federal bankruptcy code each describe different processes to allow debtors to settle financial obligations. Chapter 12 of the federal Bankruptcy Code, introduced in 1986 at the height of the 1980s farm crisis, was designed with farms in mind. It’s an alternative to a Chapter 7 filing, under which a farm’s assets are liquidated to pay creditors.
“The number of Chapter 12 bankruptcies filed this quarter underscores the significant financial pressures facing U.S. agriculture,” Pittman said. “However, these filings tell only part of the story. As the NALC DEBT Project demonstrates, the full scope of financial distress becomes clearer when agricultural bankruptcies filed under other chapters of the bankruptcy code are also considered.”
The DEBT project, Pittman said, compiles federal bankruptcy data for agricultural operations that have filed under either Chapter 11 or Chapter 12, giving a more complete picture of the scope of the issue. The additional data can help to identify changes over time, geographic patterns, and emerging financial challenges affecting agricultural operations.
Nationwide Chapter 11 bankruptcy filings increased 11.5 percent during the first three quarters of 2026 compared to the same period in 2025. According to the most recent federal court data, 7,623 Chapter 11 cases were filed in the first three quarters of 2026, up from 6,838 during the same period in 2025. Elizabeth Rumley, NALC senior staff attorney, noted that while Chapter 11 filings are not exclusive to agricultural businesses, the DEBT Project demonstrates that they can include agricultural operations and provide a more complete picture of financial distress in the agricultural sector.
Resources
- Arkansas led nation in Chapter 12 farm bankruptcy filings in 2025
- Agricultural bankruptcy tracking project sheds light on Chapter 11s and Chapter 12s
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About the National Agricultural Law Center
Created by Congress in 1987, the National Agricultural Law Center serves as the nation’s leading source of agricultural and food law research and information. The NALC works with producers, agribusinesses, state and federal policymakers, lenders, Congressional staffers, attorneys, land grant universities, students, and many others to provide objective, nonpartisan agricultural and food law research and information to the nation’s agricultural community.
The NALC is a unit of the University of Arkansas Division of Agriculture and works in close partnership with the USDA Agricultural Research Service, National Agricultural Library.
About UADA
The University of Arkansas Division of Agriculture’s mission is to strengthen agriculture, communities, and families by connecting trusted research to the adoption of best practices. Through the Agricultural Experiment Station and the Cooperative Extension Service, UADA conducts research and extension work within the nation’s historic land grant education system.
UADA is one of 22 entities within the University of Arkansas System. It has offices in all 75 counties in Arkansas and faculty on three university campuses.
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Media contact
Nick Kordsmeier
nkordse@uada.edu