Farm cash flow stress testing in the meeting: see where each farm stops repaying, with the working shown
Any borrower stress-tested in under a minute, working shown.
See one case, screen by screen ↓Rebuilding a borrower's projected cash flow under adverse conditions — lower prices, a short crop, higher costs or higher rates — to see whether it still repays its term debt. Farm Cash Flow Stress Testing does it on each farm's own spreads, crop plan, insurance and debt schedule, against the bank's standard shocks and any what-if the officer tries.
How to choose AI solutions for lending →
Updated
Every ag renewal comes down to one question: what happens to this farm's repayment if corn drops, the crop comes up short or the operating line costs more? The committee asks it in every meeting, and the borrower asks it across the desk. Margins are near breakeven for many farms, so the answer decides whether the line renews as asked, with conditions, or not at all.
Today that answer lives in one analyst's spreadsheet. Each what-if means re-keying the farm's spreads, crop plan, insurance guarantee and debt schedule, and it takes about a day to rebuild for each farm. Revenue Protection gets misread — on a normal crop, a modest price fall pays nothing and goes straight to repayment — and working capital quietly funds the shortfall for a year or two, so the stress shows up at the next renewal as carryover debt.
Estimated split of the about one day a farm's what-if takes by spreadsheet today, and with the solution. Our working assumption, to be measured.
Six specialist agents build each farm's cash flow from its own records and run the bank's shocks; the loan officer judges and signs.
Voss Family Farms wants its $1,450,000 operating line renewed for 2027. Erin Kowalski meets Mark Voss at 10:30 and takes the renewal to loan committee on Thursday 15 October. Here is her morning, screen by screen, in the working solution.
Nine borrowers are on the renewal list, $12.67M of operating lines. Eight are already tested against the bank's standard shocks; one is waiting on its 2025 return. Each test shows coverage on plan, coverage in the bank's downside and the debt break-even. Six are below 1.00 in the downside and need working capital or conditions to carry them. Voss Family Farms, Ford County, is first: 1.43× on plan, 0.47× in the downside, corn $3.90 to break even.
Median time to a test: 48 s — “about a day by spreadsheet”.
Before Erin arrives, the agents have read 14 documents. Five years from the spreads show coverage of 2.31, 2.96 and 2.04, then 0.96 in 2024 and 1.12 in 2025, and working capital down from $1,212,000 to $742,000. The signed 2027 plan, the Revenue Protection policy and the debt schedule give the base case: 1.43× against $309,036 of payments due.
Run log: “Scenario engine built the base case and ran 5 shocks — plan 1.43× (policy 1.25) · bank downside 0.47× (policy 1.00).”
Each line of the cash flow carries a source link. The 2025 coverage of 1.12× opens on the accrual-adjusted farm spread Marcus prepared from the Schedule F and balance sheets on 11 March, with the figure highlighted and the accrual adjustments noted underneath.
The home screen is Voss's 2027 cash flow on seven faders — corn, soybean and calf prices, corn and soybean yields, input costs and the operating-line rate. Above them, coverage of term debt is drawn as a curve. The corn fader already carries a red tick at $3.90, where Voss stops repaying, and an amber one at $4.16, where it drops under the bank's 1.25. The calf fader is greyed out: “No cattle on this farm”.
“Voss stops repaying below $3.90 corn.”
Erin moves corn down 15%, from $4.35 to $3.70. Repayment capacity falls to $250,836 against $309,036 of payments: coverage 0.81×, a margin of −$58,200. Below the price where Revenue Protection starts to pay, the curve goes flat — the insurance floor at 0.69×. She saves “Corn $3.70” to the credit file, where it joins the comparison and the scenario note.
“Working capital absorbs the $58,200 shortfall; 12.7 years like this would use all of it.”
Albrecht Farms runs 300 cows beside 1,100 acres of grain and covers its 2027 debt 1.27× on plan. The bank's standard shocks move crops, not calves. On the calf fader Albrecht stops repaying below $303/cwt and drops under 1.25 below $338 — $4 under the $342 deck. With no cover on calves, the curve has no insurance floor.
In the stress test, the bank's downside takes corn to $4.02, soybeans to $9.62 and the rate to 8.10%. Coverage falls to 0.47× and the repayment margin to −$164,385. Working capital ends 2027 at $577,615, 33% of revenue. Every line below is rebuilt with how it is worked out, the scenario against plan, and its source.
Erin asks the assistant to add 85% Revenue Protection, 35% of corn forward-sold at $4.52 and the combine note over 7 years. They land as a new column beside the plan and the four standard shocks: in the downside, coverage rises from 0.47× to 0.73× and working capital ends 2027 at $665,419. A fourth condition is added — working capital of at least $500,000 at each year end.
“The recommendation stays yours.”
One assumption at a time, the others held at plan: corn $4.16 for 1.25 and $3.90 for 1.00, 10.4% of room; corn yield 209 and 195 bu; cash rent $307 and $362; the operating rate 14.0% and 23.7%. Soybeans alone cannot take coverage under 1.00 — the insurance floor of $563 an acre catches them. A corn price × yield grid shows the two together.
At the $4.16 policy break-even, corn still earns $908 an acre, above the $778 guarantee — so insurance pays nothing there.
The scenario note drafter wrote the request, base case, stress table, break-evens and liquidity, and the four conditions, with 47 of 47 figures traced. The recommendation is Erin's, in her words. She signs — the meaning of the signature, “Reviewed and recommended”, is recorded with it — and the note goes to the credit file and the 15 October committee packet. The committee decides.
The same renewal, seen by the four people at the bank who carry it — what the what-if looked like by spreadsheet, and what it looks like now.
Six specialist agents build each farm's cash flow from its own records and run the bank's shocks; the loan officer judges and signs.
Reads five years of farm spreads, balance sheets and Schedule F into the bank's repayment format, and recomputes coverage, working capital and debt-to-asset for every year.
Reads the signed crop plan, cash leases, insurance summary and acreage report, and checks plan yields against the farm's own five-year history.
Lists every payment due in the year — term notes, capital leases and the operating line's interest — from the loan system and statements.
Rebuilds the year's cash flow under the plan, the standard shocks and any what-if — revenue with any indemnity the policy would pay, costs, interest, repayment capacity, coverage and working capital — with every formula shown and sourced.
Solves the price, yield, rent and rate at which coverage reaches the policy line and 1.00, one assumption at a time and in pairs.
Writes the scenario note for the credit file — request, base case, stress tests, break-evens, liquidity and any conditions the officer asks for, with their effect.
Recommends and signs; loan committee decides. The agents propose; a named person decides.
The officer can ask about any borrower in plain words — or tell it what to add. Every answer is worked from the farm's own numbers, with the sources cited.
What does $3.90 corn do to Voss Family Farms?
With everything else on plan, corn revenue falls by $131,454. Repayment capacity is $309,260 against $309,036 of payments, so coverage drops from 1.43× to 1.00× — it still covers the debt, just, but is under the bank's 1.25. Crop insurance pays nothing: $850 an acre is above the $778 guarantee.
Why doesn’t crop insurance help in a 10% price drop?
Because Voss carries Revenue Protection at 80% on enterprise units. The corn guarantee is 221 bu × 80% × $4.40 = $778 an acre, and it does not fall when prices fall. At $3.92 and a normal 218-bushel crop, revenue is still above the guarantee, so nothing is paid. Coverage in this shock is 0.78×.
What corn price keeps Voss at the bank’s 1.25?
$4.16, with soybeans, yields and costs on plan — 4.4% below the $4.35 deck. To cover the debt at all, corn must stay above $3.90. Soybeans cannot sink the farm on their own: below the $563-an-acre guarantee, insurance makes up the revenue.
Add conditions: 85% coverage, 35% of corn forward-sold, combine note over 7 years
Added to the bank's downside as a new scenario and to the note. 85% Revenue Protection lifts the guarantee to $827 an acre and pays $31,254, for $20,012 more premium; 102,242 bu are sold at $4.52; the combine note over 7 years takes payments from $309,036 to $283,595. Coverage in the downside rises from 0.47× to 0.73×. I added a fourth condition — working capital of at least $500,000 at each year end. The recommendation stays yours.
13 screens from the working solution, on its sample data. Pick one to see it large.
The thresholds every stress test is judged against, and how the numbers are built, are settings — versioned and on the audit trail.
| Setting | Default | Choose from |
|---|---|---|
| Coverage on plan | 1.25× | 1.00× to 1.60×, in steps of 0.05 |
| Coverage in the bank's downside | 1.00× | 0.90× · 1.00× · 1.10× |
| Working capital at year end | 25% of gross revenue | 20% · 25% · 30% of gross revenue |
| Two bad years in a row | On | On · Off |
| Starting point | Borrower's plan, capped at the 5-year average yield | Borrower's plan, capped at the 5-year average yield · Borrower's plan as signed · 5-year average only |
| Family living | Higher of borrower and $72,000 | Higher of borrower and $72,000 · Borrower's figure · $72,000 floor |
| Who signs the scenario note | Relationship officer | Relationship officer · Officer and credit analyst |
| Who changes the standard shocks | Chief credit officer | Chief credit officer · Credit policy committee |
Every figure is labelled: a target the solution is built to, an estimate, a typical published result, or a proven one.
“demo” = seen in the working solution, on its sample renewal season · “target” = the design goal, measured in the live solution · “estimated” = our working assumption, to be measured · “typical” = published figures (Federal Reserve Bank of Chicago AgLetter, May 2026 — operating-loan rates averaged 7.08% at the end of Q1 2026; Farmer Mac on USDA forecasts — interest takes about 21% of farm earnings before interest in 2026, up from 12% in 2021). People, farms, the bank and counties named on this page are fictional — characters and sample data in the working solution.
Rebuilding a borrower's projected cash flow under adverse conditions — lower prices, a short crop, higher costs or higher rates — to see whether it still repays its term debt. Farm Cash Flow Stress Testing does it on each farm's own spreads, crop plan, insurance and debt schedule, against the bank's standard shocks and any what-if the officer tries.
The break-even finder solves each assumption — corn and soybean price, yields, cash rent, the operating rate — for the value where coverage reaches the bank's policy line and 1.00, holding the others at plan. Those values are ticked on every fader and recomputed as the others move.
Yes, but only the indemnity the policy on file would pay. That is why a price-only shock can pass straight through to repayment: on a normal crop, Revenue Protection pays nothing until revenue per acre falls below the guarantee. For Voss Family Farms, that is corn under about $3.57; below it, insurance holds coverage at 0.69×.
No. The standard shocks and the price deck are set and versioned by the chief credit officer. Officers can add their own what-ifs on top and propose a new shock, which goes to the chief credit officer.
No. The agents build the cash flow, run the shocks and draft the scenario note. The loan officer writes the recommendation and signs; the loan committee decides, and renewals below 1.00 in the downside go to the chief credit officer first.
The farm spreads and balance sheets, the signed crop plan and cash leases, the crop insurance summary and acreage report, the loan agreements and the bank's price deck. Every line of every scenario links back to the document it came from.
Yes. Coverage on plan, coverage in the bank's downside, working capital at year end, the two-year downside test, how the starting point and family living are set, and who signs are all settings, versioned and on the audit trail.
The Agentic Solution Engine builds and deploys it from your requirements and documents — your credit policy, standard shocks, price deck and a sample of renewal files — and it goes live once every quality gate has passed. We will walk you through it on your own borrowers first.
We’ll run Farm Cash Flow Stress Testing on a sample of your own operating line renewals.