Arkansas agriculture sector faces crisis amid rising costs and bankruptcies

The Arkansas agriculture sector is experiencing significant financial instability, characterized by a sharp decline in crop cash receipts and a rise in farm bankruptcies. According to the University of Arkansas Division of Agriculture, crop cash receipts have dropped 17.4% compared to the previous year.

Financial challenges are being driven by several factors, including increased input costs for fuel and fertilizer. Conflict in the Middle East, specifically involving Iran and the Strait of Hormuz, has contributed to a conservative estimated increase of $343 million in costs for Arkansas farmers. Additionally, the price of agricultural diesel has risen 72% above budgeted amounts.

Row crop producers are facing substantial losses per acre. Estimates indicate losses ranging from $80 to $85 for soybeans, $131 to $170 for corn, $258 to $442 for rice, and approximately $345 for cotton. The state led the nation in farm bankruptcies in 2025, and through the first three quarters of 2026, 32 agricultural operations have already filed for Chapter 12 bankruptcy protection.