The purpose of the article is to substantiate the main principles of reengineering of business processes as an effective method for transforming of the institutional structure of the national economy’s agrarian sector. Research methods. The research is based on a dialectical method, which uses systemic, institutional, and processual approaches to development of the agrarian sector. In the research process have been used such scientific methods, such as: abstract and logical and systematization have been used for formation of the method of the institutional structure reengineering; economic and mathematical modelling for constructing a model for structure optimization of agrarian products in the real management environment. Research results. It has been determined that practical implementation of the postulates of institutional, system, and processual approaches is possible by usage of the method of business processes reengineering. This solution has been realized on basis of an application of reengineering techniques for the institutional system and methods of mathematical modeling. For development of the agrarian sector, business processes should be analyzed at the macro level, where institutions act as prototypes of business processes. Elements of scientific novelty. It has been proposed a methodology for calculating a structure of agricultural production based on solution of a stochastic problem with institutional constraints considering a procedural approach to production processes review, which takes into account probabilistic factors of agricultural production and institutional constraints. Practical significance. Method of modeling for reengineering of the institutional system allows to form an optimal structure for manufacturing of agrarian products in real management conditions, which considers an influence of institutions’ transformation. Refs.: 18.