President Trump’s trade war has been back in the headlines this week thanks to his threat to impose new tariffs on iPhones and the announcement that General Motors is closing several U.S. plants. But those aren’t the only industries dealing with the fallout from Trump’s trade policies; tariffs may also be contributing to an uptick in Chapter 12 bankruptcies filed by U.S. farmers. Per the Minneapolis Star Tribune:
Eighty-four farms filed for Chapter 12 bankruptcy in Wisconsin, Minnesota, North Dakota, South Dakota and Montana in the 12 months that ended in June, according to a new analysis from the Federal Reserve Bank of Minneapolis. That’s more than double the number over the same period in 2013 and 2014, and the number of bankruptcies in Minnesota doubled over the past four years from eight to 20.
In retaliation for American tariffs on Chinese goods, the Chinese government levied tariffs of their own on American soybeans, pork, and dairy in April.
Prices for some American agricultural goods, like dairy, had already dropped by the time Trump announced the tariffs. CNBC reported in June that the number of American dairy farms had dropped by half since 2000, a trend that reflects reduced domestic demand and falling prices. Prices for soybeans have fallen too, as have prices on other animal products, like beef. More broadly, America’s small farmers have been struggling for decades, with agricultural monopolies controlling ever-larger shares of the market. But the crisis now looks more widespread, as tariffs introduce new economic burdens to farmers. As global demand dropped, many U.S. farmers were forced to let their crops rot in their fields.
“In Louisiana, up to 15 percent of the oilseed crop is being plowed under or is too damaged to market, according to data analyzed by Louisiana State University staff,” Reuters reported in a November 21 investigation. “Crops are going to waste in parts of Mississippi and Arkansas. Grain piles, dusted by snow, sit on the ground in North and South Dakota. And in Illinois and Indiana, some farmers are struggling to protect silo bags stuffed with crops from animals.”
Thus, Monday’s bankruptcy news had the feel of inevitability to it — and it stoked fears of another farm crisis.
During the last crisis, which unfolded during most of the 1980s, debt and depreciating land values contributed to record farm bankruptcies; more than 500 farms closed per week, as Civil Eats reported in September. That financial crisis beget other plagues. A 1991 study by the National Farm Medicine Center found that 913 male farmers died by suicide from 1980 to 1988, at a rate “nearly double the national average for white men in some of those years,” as the Associated Press explained at the time.
Thirty years later, matters aren’t quite so dire for American farmers — at least not yet. But Trump’s tariffs offer struggling farmers little hope for a more stable future. And despite his overtures to hard-hit farmers, that may hurt the president’s popularity with rural voters who haven’t forgotten the 1980s.