Wednesday , February 24 2021

Family farms go bankrupt: low prices for corn, soybeans, milk and beef contributing to farm bankruptcy on the rise in the Upper Midwest

The number of farms that went bankrupt during the Upper Midwest is increasing. According to a recent analysis of the National Bank of Minneapoli, this trend comes from low prices for corn, soybeans, milk and beef.

The analysis filed for bankruptcy of 84 farms in Wisconsin, Minnesota, North Dakota, South Dakota and Montana within 12 months of June. In 2013 and 2014, it is twice as many as in the same period.

"The current price levels and the course of current trends show that this trend has not reached its peak yet," said Ron Wirtz, an analyst at Minneapolis Fed.

As reported by the Star Tribune, the increase in Section 12 files reflects low prices for corn, soybeans, milk and beef. This has been worsened by farmers since June due to reprisals tariffs, which shut down the Chinese market for soybeans and reclaim milk and beef exports. Section 12 is designed for bankrupt family farmers and fishermen and for the repayment of the debt for three years.

"Presently, milk farmers are experiencing the most problems," said Mark Miedtke, president of Hayfield Citizens' State Bank. "Grain farmers have had low prices for the past three years, but high returns have helped them. We're just waiting for a turnaround.

Miedtke, the underlying problem began before the trade problems, farmers are very efficient for the financial goods and does not keep up with the pace of production, he said.

"The picture may begin to change this spring," Miedtke said. "We're doing everything we can to try to work with the farmers."

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