Reviewing the pros and cons of AgriStability

This article was first published on October 10, 2018 and was revised on January 14, 2026. 

AgriStability provides financial protection when your production margins decline. In essence, it acts as a financial safety net: farmers receive payments when their production margin falls below 70 percent of their reference margin, which is determined by averaging their production margin over five years after eliminating the highest and lowest years. In many cases, the benefits of the program outweigh the time and expense required to participate.  

Here’s what works well and what to consider as you evaluate whether this program aligns with your operation. 

PRO – Financial protection

AgriStability offers financial protection if you have a bad year. When your production margin falls below 70 percent of your reference margin, you'll receive a payment. For example, if your reference margin is $100,000, you qualify for a payment if your current-year production margin is less than 70 percent of that amount ($70,000). If your production margin is $60,000, you’d be $10,000 below your reference margin and would be entitled to 80 percent of that amount, meaning you would receive a payment of $8,000. 

CON – Challenges for cash croppers

The higher a farm’s gross margins, the less sensitive the operation is to changes in factors such as market prices, production declines, and rising expenses. Under AgriStability, higher-margin producers need a larger percentage change in those factors to qualify for payments. Cash croppers typically have higher gross margins than other farming sectors, such as hog or feeder cattle operations. In addition, they can mitigate risk through other programs, such as crop insurance, which provides protection against significant yield losses. As a result, many cash croppers find they're less likely to qualify for AgriStability payments. 

CON – Unexpected fees and requirements

AgriStability requires detailed record-keeping and administrative work beyond the entry fee. In many cases, farmers hire advisors to help complete AgriStability applications, which adds to the cost of staying in the program. If you qualify for a payment, the government agency will likely request more information than you’re used to providing. If you don't currently maintain detailed records, prepare for additional time investment to meet program requirements.

PRO – Simplified Tax-Aligned Reference Margin Program (TARM) available

TARM became available starting with the 2025 program year. TARM allows producers to have their reference margin calculated using the same accounting method they use for tax filing (cash or accrual), rather than the traditional accrual-adjusted method. This simplifies reporting because there are no accrual adjustments if a cash basis margin is used, and for accrual tax filers with livestock, the breeding herd adjustment is removed. If the producer does not expect to qualify for a payment, no AgriStability year-end report is required. If the producer expects they may qualify for a payment, they will need to prepare a year-end report and claim form to report accrual information, while the reference margin still uses the accounting method used for tax filing. 

CON – TARM drawbacks

Accrual-based reference margins provide the most accurate picture of financial performance. Significant differences between accrual and cash basis numbers can result from changes in receivables, prepaid expenses, inventory, and payable balances, which lowers the accuracy of margin protection. Also, production history used to adjust reference margins for changes in operating size is still required, so producers must ensure they are tracking these production factors. 

PRO – Eligibility for the Advance Payments Program

There are two loan programs available to farmers through Agriculture Credit Corporation (ACC). Farmers can qualify for up to $750,000 at a prime rate of interest through the Commodity Loan Program (CLP), but they must also participate in production insurance. In contrast, the Advance Payments Program (APP) offers up to $1,000,000, and eligibility is based only on enrollment in AgriStability or crop insurance. The first $100,000 is available interest-free, and any additional amount is subject to interest at the prime rate. 

CON – Alternatives may be easier

When choosing between AgriStability and production insurance for APP eligibility, most cash crop farmers opt for production insurance, as the application process is far less complicated. For production insurance, the producer only needs to provide production information (number of acres and yield for each crop). AgriStability requires this production information, as well as income and expense details. 

Every farm operation is different. We're here to help you evaluate these variables and determine what's best for your operation—whether that's AgriStability, alternative programs, or a combination of risk management strategies.