Farm Working Capital Calculator
Coverage is only half of what your lender reads. Enter your current assets, current liabilities, and gross revenue to see your working capital to gross revenue ratio against the 20–30% line ag lenders look for. No signup, no gate — nothing is required to see your number.
Also check your debt service coverage ratio →For lenders: share this with your borrowers →
Current assets
Anything that turns into cash within twelve months.
- Total current assets
- $760,000
Current liabilities
Anything due within twelve months — including the principal on term debt that comes due this year.
- Total current liabilities
- $425,000
Gross farm revenue
Total farm income for the year — grain sales, livestock, government payments, and crop insurance. This is the denominator.
Stress test it
Grain in the bin is the biggest line on most farm balance sheets, and it moves with the market. Drop the price and watch what happens to the cushion.
Adequate for many operations, with room to strengthen. Most ag lenders are comfortable here but will watch the trend.
What the number means
- Below 10%Vulnerable — high risk of liquidity problems.
- 10% – 20%Thin. Limited buffer; expect conditions or an earlier operating draw.
- 20% – 30%Adequate for many operations — still room to strengthen.
- 30% – 35%Strong — the target many ag lenders prefer on crop farms.
- 35% and upVery strong cushion to weather a downturn.
The formula
Working Capital = Current Assets − Current Liabilities
WC / GR Ratio = Working Capital ÷ Gross Farm Revenue
Lenders vary — some value grain inventory conservatively, some exclude prepaid inputs. Treat this as the ballpark and confirm the convention your bank uses.
Read: how lenders read farm liquidity →Agricultural working capital, in plain terms
What agriculture working capital actually is
Agriculture working capital is the money your operation has to fund the next twelve months after covering everything due in the next twelve months. On a crop farm it's mostly grain in the bin, cash, receivables, and prepaid inputs — minus the operating line, payables, and this year's term-debt principal. It's the cushion that decides whether a wet spring or a price drop is a crisis or just a story.
Why farms carry it differently than other businesses
A retail store collects revenue daily. A corn and soybean operation spends money for eight months before the first bushel sells, then holds most of the year's value in a bin that moves with the futures market. That single annual payday is why agricultural lenders weight working capital so heavily — the farm has to self-fund a long, expensive gap between spending and selling.
The benchmark ranges lenders actually use
Most ag lenders read working capital as a percentage of gross farm revenue: below 10% is vulnerable, 10–20% is thin, 20–30% is adequate, and 30% or better is the comfort zone on crop farms. The exact line varies by bank and by enterprise — livestock and dairy carry different needs than cash grain — but the direction of the number year over year matters as much as the level.
How it works together with DSCR at renewal
Working capital is the cushion; debt service coverage is the cash-flow test. Lenders read the two as a pair: strong coverage with thin liquidity means one bad season erases the cushion, and a fat balance sheet with weak coverage means the payments still don't get made. Run both before the bank does — check your DSCR and see how lenders read the full ratio set.
Frequently asked questions
What is farm working capital?＋
Working capital is current assets minus current liabilities — the cash and near-cash you could use in the next twelve months after covering what you owe in the next twelve months. Current assets include cash, receivables, grain inventory at market value, and prepaid inputs. Current liabilities include the operating line, payables, accruals, and the current portion of term debt.
Why do lenders use working capital to gross revenue instead of dollars?＋
A $300,000 cushion means something very different on a 400-acre farm than on a 4,000-acre farm. Dividing working capital by gross farm revenue scales the buffer to the size of the operation, so lenders can compare farms and track you year over year. Most ag lenders want to see 20% or better, and 30% or more on crop farms.
What counts as a current asset or current liability?＋
Current means it converts to cash or comes due within twelve months. Assets: cash and savings, accounts receivable, grain and crop inventory at market value, prepaid expenses and inputs, and other current assets. Liabilities: operating loan balance, accounts payable, accrued interest and taxes, the principal portion of term debt due within a year, and other current liabilities.
Is this calculator accurate?＋
It's a ballpark from the numbers you type in. Your real ratio comes off a balance sheet that ties to your accrual-adjusted P&L and cash flow — what TG360 builds from your Schedule F, invoices, and bank statements. Use this for the quick check; confirm the convention your bank uses.
Walk into renewal with both numbers
Coverage and liquidity are the two ratios your banker reads first. TG360 turns your Schedule F, invoices, and bank statements into an accrual-adjusted P&L, balance sheet, and cash flow — with the lender ratio summary that carries both. Free for 7 days.