The 2025 Farm Crisis: Bankruptcies Up 46% While Subsidies Flow to the Top

The Numbers Paint a Stark Picture

The 2025 farm crisis is unfolding in real time. Chapter 12 farm bankruptcies — a legal mechanism specifically designed for family farmers — surged to 315, the highest level since 2012. Net farm income is projected to fall by $44 billion, driven by falling commodity prices, rising input costs, persistent drought in the West, and the lingering effects of trade disruptions.

Meanwhile, the USDA continues distributing billions in farm subsidies. But here's the disconnect: the farms going bankrupt are overwhelmingly small and mid-size operations, while the farms receiving the most subsidy dollars are the largest operations that are least likely to need the help.

Subsidy Spending Trends

The Disconnect

The fundamental problem is structural. Farm subsidies are largely tied to production volume, acreage, and commodity prices. This means larger operations — which farm more acres and produce more bushels — automatically receive larger payments. A 10,000-acre corn operation in Iowa will always receive more from ARC and PLC programs than a 200-acre diversified farm in Vermont, regardless of which one is struggling more.

Our data shows the top 10% of recipients collect ~70% of all payments. These are not the operations filing for bankruptcy. The farms going under are typically too small to benefit meaningfully from commodity programs, too diversified to qualify for crop-specific payments, or too new to have established baselines.

What Could Be Different?

Some proposals in the 2025 Farm Bill debate would address this disconnect: means-testing for subsidy recipients, higher payment rates for small and beginning farmers, and expansion of conservation programs that serve diverse operations. Whether Congress acts before more farms fail remains to be seen.

Explore our data on small vs. large farm payments, payment limit effectiveness, and top recipients to understand who the current system serves.