ADJUSTED GROSS REVENUE (AGR). What’s In It For You?. What Is AGR?. Risk Management Tool Insures against low revenue due to unavoidable natural disasters and market fluctuation Uses a producer’s historical farm revenue as a base to provide a level of guaranteed revenue. What Is AGR?.
What’s In It For You?
At least one of the two most recent years income is greater than the average AND expected revenue exceeds average.
Each year is divided by the previous year with a maximum (cap) of 1.2000 and a minimum (cup) of .8000, then averaged.
Index is greater than 1.000, so AGR qualifies for indexing.
Index of 1.084 is taken to the 4th power (multiplied by itself 3 times) 1.084 x 1.084 x 1.084 x 1.084 =
Average Income is multiplied by factor
$194,200 x 1.381 = $268,143
Indexed AGR from example =
Expected Insurance Year Revenue from example = $250,000
Approved AGR is the lesser of the indexed average and expected revenue - $250,000
Chemical, Fertilizer, Seeds, Plants
Depreciation (of animals only)
Veterinary, breeding & medicine
Freight, Trucking, Gasoline, Oil
Insurance (not health)
Labor (less share-holder & credits)
Others directly related to the production of commoditiesExpenses Included in AGR Average
Failure to follow good farming practices
Water contained by any govt, public or private dam or reservoir
Failure or breakdown of irrigation equipment
Vandalism, mysterious disappearance, theft
Quarantines, boycott or refusal to accept
Lack of labor
Failure of any buyer to pay the insured
Failure to obtain price reflective of local market valueEvents Not Covered by AGR
GreenStone Farm Credit
Do you have a large enough cash
reserve to operate at a loss for a
long period of time?