Finance Tools
Farm Subsidy Impact Calculator
Estimate how farm subsidies change net income, break-even price, and cash-flow buffer under different scenarios.
Subsidies can materially change your net income and your break-even price. This tool shows side-by-side outcomes with and without subsidy.
Use any unit (bushels/tons/etc.) if prices and costs match.
Expected selling price (not including subsidy).
Operating + fixed costs (consistent across both scenarios).
If subsidy scales with production or eligible units.
Net income (no subsidy)
$50,000
Revenue: $270,000 · Costs: $220,000
Net income (with subsidy)
$68,000
Subsidy used: $18,000 · Change: +$18,000
Break-even price (no subsidy)
$3.67 / unit
Cushion at current price: $0.83
Break-even price (with subsidy)
$3.37 / unit
Cushion at current price: $1.13
Tip: If you’re unsure about subsidies, test a conservative case (50% of expected) and compare buffers.
How it works
- Revenue = yield × price.
- Net income (no subsidy) = revenue − costs.
- Net income (with subsidy) = revenue + subsidy − costs.
- Break-even price (with subsidy) = (costs − subsidy) ÷ yield.
FAQ
Does subsidy always reduce break-even price?
If it’s truly incremental cash and costs are unchanged, yes—it offsets costs, lowering effective break-even.
What if subsidy eligibility caps out?
Use “Total subsidy” mode and enter the capped amount rather than per-unit.
What’s a good conservative scenario?
Try 0% subsidy (worst case), then 50% of expected (conservative), then full expected.
How to use this farm subsidy impact calculator
- Enter expected yield and baseline crop price.
- Enter total costs (or cost per unit).
- Enter expected subsidy amount (total or per unit).
- Compare net income and break-even price with vs without subsidy.
Example
A farm expects 60,000 units at $4.50/unit with total costs $220,000 and a subsidy of $0.30/unit.
- Baseline revenue = 60,000 × $4.50 = $270,000
- Subsidy = 60,000 × $0.30 = $18,000
- Net income change = +$18,000 (costs unchanged)
- Break-even price decreases because subsidy offsets costs
More tools in Finance Tools
- Farm Break-Even Yield Calculator
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- Farm Break-Even Price Calculator
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- Farm Loan Stress Test Calculator
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- Farm Debt Risk Calculator
Estimate farm debt risk using key ratios like debt-to-asset, debt-to-income, and DSCR to flag financial stress.