EXHIBIT 12


<PAGE>



                    COMPUTATION OF RATIO OF MARGINS TO FIXED
                    CHARGES AND PREFERRED DIVIDENDS COMBINED


<TABLE>
<CAPTION>


                                                          AGWAY INC. AND CONSOLIDATED SUBSIDIARIES
                                                               FOR THE YEARS ENDED JUNE 30,
                                                                  (THOUSANDS OF DOLLARS)

                                                1997         1996          1995         1994         1993
                                            ----------    ---------    -----------   ---------    ----------
<S>                                         <C>           <C>          <C>           <C>          <C>
Margins before income taxes and
member refunds............................. $   16,583    $  21,070    $   (6,053)   $   4,833    $   17,395

Fixed charges - Interest...................     64,432       63,721        56,507       49,849        49,128
              - Rentals....................      3,772        3,004         2,789        2,298         2,610
                                            ----------    ---------    -----------   ---------    ----------
Total fixed charges........................     68,204       66,725        59,296       52,147        51,738
                                            ----------    ---------    -----------   ---------    ----------
Adjusted net margins....................... $   84,787    $  87,795    $   53,243    $  56,980    $   69,133
                                            ==========    =========    ===========   =========    ==========

Ratio of adjusted net margins to total
fixed charges..............................        1.2          1.3        (a)             1.1           1.3
                                            ==========    =========    ===========   =========    ==========

Deficiency of adjusted net margins to
total fixed charges........................       N/D         N/D      $    6,053        N/D           N/D
                                            ===========   ==========   ===========   ==========   ==========

<CAPTION>
Fixed charges and preferred dividends combined:
Preferred dividend factor:
<S>                                         <C>           <C>          <C>           <C>          <C>       
   Preferred dividend requirements......... $    4,115    $   4,255    $    4,654    $   4,909    $    4,130
   Ratio of pre-tax margins to
   after-tax margins*......................      64.3%        52.9%         71.1%        13.5%        143.0%
   Preferred dividend factor on
   pre-tax basis...........................      6,400        8,043         6,546       36,363         2,888

Total fixed charges (above)................     68,204       66,725        59,296       52,147        51,738
                                            ----------    ---------    ----------    ---------    ----------

Fixed charges and preferred dividends
combined................................... $   74,604    $  74,768    $   65,842    $  88,510    $   54,626
                                            ==========    =========    ==========    =========    ==========

Ratio of adjusted net margins to fixed
charges and preferred dividends
combined**.................................        1.1          1.2        (b)          (b)              1.3
                                            ==========    =========    ==========    =========    ==========

Deficiency of adjusted net margins to
fixed charges and preferred dividends
combined...................................      N/D          N/D      $   12,599    $  31,530         N/D
                                            ==========    =========    ==========    =========    ==========

</TABLE>

*        Represents  pre-tax  adjusted  net margin  from  continuing  operations
         divided by after-tax margin, which adjusts dividends on preferred stock
         to a pre-tax basis.

**       Represents adjusted net margin divided by fixed charges and preferred 
         dividends combined.

N/D      No deficiency.

(a)      Adjusted net margins are inadequate to cover total fixed charges.

(b)      Adjusted net margins are inadequate to cover total fixed charges and
         preferred dividends combined.


<PAGE>


                    COMPUTATION OF RATIO OF MARGINS TO FIXED
                    CHARGES AND PREFERRED DIVIDENDS COMBINED


<TABLE>
<CAPTION>

                                                                   AGWAY INC. (PARENT)
                                                              FOR THE YEARS ENDED JUNE 30,
                                                                 (THOUSANDS OF DOLLARS)

                                                1997         1996          1995         1994         1993
                                            -----------   ----------   -----------   ----------   ----------
<S>                                         <C>           <C>          <C>           <C>          <C> 
Margins before income taxes and
member refunds............................. $    3,535    $  24,106    $    4,600    $ (17,330)   $    4,501

Fixed charges - Interest...................      6,792        7,156         5,874       14,985         8,282
              - Rentals....................      2,074        1,506         1,960        1,183           755
                                            -----------   ----------   -----------   ----------   ----------
Total fixed charges........................      8,866        8,662         7,834       16,168         9,037
                                            -----------   ----------   -----------   ----------   ----------
Adjusted net margins....................... $   12,401    $  32,768    $   12,434    $  (1,162)   $   13,538
                                            ===========   ==========   ===========   ==========   ==========

Ratio of adjusted net margins to total
fixed charges..............................        1.4          3.8           1.6       (a)              1.5
                                            ===========   ==========   ===========   ==========   ==========

Deficiency of adjusted net margins to
total fixed charges........................      N/D          N/D           N/D      $  17,330         N/D
                                            ===========   ==========   ===========   ==========   ==========
<CAPTION>
Fixed charges and preferred dividends combined:
 Preferred dividend factor:
<S>                                         <C>           <C>          <C>           <C>          <C>       
   Preferred dividend requirements......... $    4,115    $   4,255    $    4,654    $   4,909    $    4,130
   Ratio of pre-tax margin to
   after-tax margins*......................     323.6%        90.9%      (291.2%)       214.5%        404.4%
   Preferred dividend factor on............
   pre-tax basis...........................      1,272        4,681        (1,598)       2,289         1,021

Total fixed charges (above)................      8,866        8,662         7,834       16,168         9,037
                                            -----------   ----------   -----------   ----------   ----------

Fixed charges and preferred dividends
combined................................... $   10,138    $  13,343    $    6,236    $  18,457    $   10,058
                                            ===========   ==========   ===========   ==========   ==========

Ratio of adjusted net margins to fixed
charges and preferred dividends
combined**.................................        1.2          2.5           2.0       (b)              1.3
                                            ===========   ==========   ===========   ==========   ==========

Deficiency of adjusted net margins to
fixed charges and preferred dividends......      N/D          N/D           N/D      $  19,619         N/D
                                            ===========   ==========   ===========   ==========   ==========
</TABLE>

*        Represents  pre-tax  adjusted  net margin  from  continuing  operations
         divided by after-tax margin, which adjusts dividends on preferred stock
         to a pre-tax basis.

**       Represents adjusted net margin divided by fixed charges and preferred
         dividends combined.

N/D       No deficiency.

(a)      Adjusted net margins are inadequate to cover total fixed charges.

(b)      Adjusted net margins are inadequate to cover total fixed charges and 
         preferred dividends combined.