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Visualized: U.S. Corporate Bankruptcies On the Rise

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U.S. Corporate Bankruptcies on the Rise

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Visualized: U.S. Corporate Bankruptcies on the Rise

In March, Silicon Valley Bank collapsed, plunging its parent company SVB Financial Group into bankruptcy a week later.

While many expected a wave of bank failures to follow, much of this has since been averted—but cracks have begun to emerge with Moody’s recent downgrading of 10 small and mid-sized banks.

Across the wider corporate landscape, bankruptcies have begun to tick higher. Overstretched balance sheets coupled with 11 interest rate hikes since last year have added to mounting challenges for companies across many sectors.

This graphic shows the surge in corporate bankruptcies in 2023 based on data from S&P Global.

U.S. Corporate Bankruptcies Grow

So far in 2023, over 400 corporations have gone under. Corporate bankruptcies are rising at the fastest pace since 2010 (barring the pandemic), and are double the level seen this time last year.

Below, we show trends in corporate casualties with data as of July 31, 2023:

Year of FilingBankruptcy Filings
as of July
Annual Total
2023402N/A
2022205373
2021256408
2020407639
2019334590
2018317518
2017305520
2016354576
2015292525
2014273471
2013349558
2012362586
2011364634
2010530827

Represents public or private companies with public debt where either assets or liabilities are greater than or equal to $2 million, or private companies where assets or liabilities are greater than or equal to $10 million at time of bankruptcy.

Firms in the consumer discretionary and industrial sectors have seen the most bankruptcies, based on available data. Historically, both sectors carry significant debt on their balance sheets compared to other sectors, putting them at higher risk in a rising rate environment.

Overall, U.S. corporate interest costs have increased 22% annually compared to the first quarter of 2021. These additional costs, combined with higher wages, energy, and materials, among others, mean that companies may be under greater pressure to cut costs, restructure their debt, or in the worst case, fold.

Billion-Dollar Bankruptcies

This year, 16 companies with over $1 billion in liabilities have filed for bankruptcy. Among the most notable are retail chain Bed Bath & Beyond and the parent company of Silicon Valley Bank.

CompanyPrimary SectorDate
Party CityConsumer DiscretionaryJan 2023
Serta Simmons BeddingConsumer DiscretionaryJan 2023
AvayaInformation TechnologyFeb 2023
Diamond Sports Communication ServicesMar 2023
SVB FinancialFinancialsMar 2023
LTL ManagementN/AApr 2023
Bed Bath & BeyondConsumer DiscretionaryApr 2023
Whittaker, Clark & DanielsN/AApr 2023
MonitronicsIndustrialsMay 2023
Kidde-FenwalConsumer DiscretionaryMay 2023
Envision HealthcareHealthcareMay 2023
DieboldN/AJun 2023
Wesco AircraftIndustrialsJun 2023
PGX HoldingsIndustrialsJun 2023
CyxteraInformation TechnologyJun 2023
Voyager AviationIndustrialsJul 2023

Mattress giant Serta Simmons filed for bankruptcy early this year. It once made up nearly 20% of bedding sales in America. With a vast share of debt coming due this year, the company was unable to make payments due to higher borrowing costs.

What Comes Next?

In many ways, U.S. corporations have been resilient despite the sharp rise in borrowing costs and economic uncertainty.

This can be explained in part by stronger than anticipated profits seen in 2022. While some companies have cut costs, others have hiked prices in an inflationary environment, creating buffers for rising interest payments. Still, S&P 500 earnings have begun to slow this year, falling over 5% in the second quarter compared to last year.

Secondly, the structure of corporate debt is much different than before the global financial crash. Many companies locked in fixed-rate debt over longer periods after the crisis. Today, roughly 72% of rated U.S. corporate debt has fixed rates.

At the same time, banks are getting more creative with their lending structures when companies get into trouble. There has been a record “extend and amend” activity for certain types of corporate bonds. This debt restructuring is enabling companies to keep operating.

The bad news is that corporate debt swelled during the pandemic, and eventually this debt will come due likely at much higher costs and with more severe consequences.

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Agriculture

The World’s Top Cocoa Producing Countries

Here are the largest cocoa producing countries globally—from Côte d’Ivoire to Brazil—as cocoa prices hit record highs.

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This tree map graphic shows the world's biggest cocoa producers.

The World’s Top Cocoa Producing Countries

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

West Africa is home to the largest cocoa producing countries worldwide, with 3.9 million tonnes of production in 2022.

In fact, there are about one million farmers in Côte d’Ivoire supplying cocoa to key customers such as Nestlé, Mars, and Hershey. But the massive influence of this industry has led to significant forest loss to plant cocoa trees.

This graphic shows the leading producers of cocoa, based on data from the UN FAO.

Global Hotspots for Cocoa Production

Below, we break down the top cocoa producing countries as of 2022:

Country2022 Production, Tonnes
🇨🇮 Côte d'Ivoire2.2M
🇬🇭 Ghana1.1M
🇮🇩 Indonesia667K
🇪🇨 Ecuador337K
🇨🇲 Cameroon300K
🇳🇬 Nigeria280K
🇧🇷 Brazil274K
🇵🇪 Peru171K
🇩🇴 Dominican Republic76K
🌍 Other386K

With 2.2 million tonnes of cocoa in 2022, Côte d’Ivoire is the world’s largest producer, accounting for a third of the global total.

For many reasons, the cocoa trade in Côte d’Ivoire and Western Africa has been controversial. Often, farmers make about 5% of the retail price of a chocolate bar, and earn $1.20 each day. Adding to this, roughly a third of cocoa farms operate on forests that are meant to be protected.

As the third largest producer, Indonesia produced 667,000 tonnes of cocoa with the U.S., Malaysia, and Singapore as major importers. Overall, small-scale farmers produce 95% of cocoa in the country, but face several challenges such as low pay and unwanted impacts from climate change. Alongside aging trees in the country, these setbacks have led productivity to decline.

In South America, major producers include Ecuador and Brazil. In the early 1900s, Ecuador was the world’s largest cocoa producing country, however shifts in the global marketplace and crop disease led its position to fall. Today, the country is most known for its high-grade single-origin chocolate, with farms seen across the Amazon rainforest.

Altogether, global cocoa production reached 6.5 million tonnes, supported by strong demand. On average, the market has grown 3% annually over the last several decades.

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