Breaking the Backs of America's Farmers, One Bankruptcy at a Time

When Trump launched his trade wars he didn't pay much attention to those Americans likely to become his collateral damage. Among those were America's farmers.

According to the Wall Street Journal, Trump's trade antics were the straw that broke the farmers' back, triggering a wave of bankruptcies across America's farm belt.

Bankruptcies in three regions covering major farm states last year rose to the highest level in at least 10 years. The Seventh Circuit Court of Appeals, which includes Illinois, Indiana and Wisconsin, had double the bankruptcies in 2018 compared with 2008. In the Eighth Circuit, which includes states from North Dakota to Arkansas, bankruptcies swelled 96%. The 10th Circuit, which covers Kansas and other states, last year had 59% more bankruptcies than a decade earlier. 

States in those circuits accounted for nearly half of all sales of U.S. farm products in 2017, according to U.S. Department of Agriculture data. 

The rise in farm bankruptcies represents a reckoning for rural America, which has suffered a multiyear slump in prices for corn, soybeans and other farm commodities touched off by a world-wide glut, made worse by growing competition from agriculture powerhouses such as Russia and Brazil.

Trade disputes under the Trump administration with major buyers of U.S. farm goods, such as China and Mexico, have further roiled agricultural markets and pressured farmers’ incomes. Prices for soybeans and hogs plummeted after those countries retaliated against U.S. steel and aluminum tariffs by imposing duties on U.S. products like oilseeds and pork, slashing shipments to big buyers. 

Low milk prices are driving dairy farmers out of business in a market that’s also struggling with retaliatory tariffs on U.S. cheese from Mexico and China. Tariffs on U.S. pork have helped contribute to a record buildup in U.S. meat supplies, leading to lower prices for beef and chicken.

...Agricultural lenders, bankruptcy attorneys and farm advisers warn further bankruptcies are in the offing as more farmers shed assets and get deeper in debt, and banks deny the funds needed to plant a crop this spring.

...Conversations with distressed farmers have become more frequent for Frank Friar, a retired agricultural lender who mans phones at the Wisconsin Farm Center. The organization advises dairy farmers and crop producers on financing options, bankruptcy and when to leave the farm behind. Last year, it received more than 2,300 calls, the most since 2010, and the center has hired more staff in the past two years. 

About a dozen times a year, Mr. Friar and his colleagues talk with a farmer who seems to be contemplating suicide, he said. The center’s staff often calls family members or neighbors who can check on the farmers, and sometimes Mr. Friar drives out to farms himself. “The uncertainty, will they survive on the home farm, is [causing] more people to think negatively,” Mr. Friar said.

Most of these farmers are from Heartland states that Trump took in a landslide in 2016. I'm pretty sure they weren't expecting this is how he would make America great again.

Photo: Trump speaks at American Farm Bureau convention in January, 2018