Deadlines to Apply for USDA Value-Added Ag Grants

USDA Rural Development is offering grants to assist with value-added agriculture projects.

Published on: May 14, 2009

USDA has announced that June 22 and July 6 are the application deadlines for grants to assist independent agricultural producers entering into value-added activities. "If you want to apply for value-added producer grants this year from USDA, you need to do it before these dates," says Tim Helmbrecht, acting state director for USDA's Rural Development agency in Iowa.

"These grants provide America's farmers with the investment funds needed to expand their role in developing and marketing value-added products in domestic and international markets," says Helmbrecht. "To ensure project applications are complete we strongly encourage that the draft applications be submitted to our office for preliminary review at least three weeks prior to their deadline."

Submit drafts at least three weeks before deadline

Since 2001, there have been 120 producers and businesses in Iowa that have received more than $20 million through this program. A total of $18 million is available nationwide in 2009.

Grants are available to independent producers, agricultural producer groups, farmer or rancher cooperatives and majority-controlled producer-based business ventures. Grants can be used for planning that establishes a viable value-added marketing opportunity, or for working capital to operate a value-added business entering an emerging market.

The 2008 Farm Bill expanded the Value Added Producer Grant program and reserved 10% of available funds for mid-tier value chain projects which are local and regional supply networks that link independent producers with businesses and cooperatives that market value added ag products. In addition, 10% of the available funds will be reserved for beginning or socially disadvantaged farmers or ranchers. Another new feature to the program this year is a simplified application process for project proposals requesting less than $50,000.

Some are due July 6, some are due June 22

Applications for mid-tier value chain projects and applications submitted by beginning or socially disadvantaged farmers or ranchers must be completed and postmarked no later than June 22. All other applications must be postmarked no later than July 6.

Planning grants can be used for feasibility studies, marketing and/or business plans. Grants can be used to pay consultants who guide producers through the development processes. The planning activities must be related to the marketing of a value-added product.

Working capital grants can be used by new or existing businesses to pay the operating expenses of new ventures entering emerging markets. Applicants other than independent producers applying for a Working Capital Grant must demonstrate that the value-added venture has not been in operation more than two years in order to show that the applicant is entering an emerging market.

What kind of projects qualify for grants?

Examples of previous grant recipients in Iowa include ethanol plants, biodiesel facilities, large wind farms, wineries, branded meat marketers, as well as pork, specialty soy oil and cheese and milk processors.

"USDA's Value Added Producer Grant program creates jobs and improves the financial returns for producers and farm families across rural Iowa, and rural America," says Helmbrecht. "I hope producers with an interest in starting or expanding their value-added business will contact us."

Contact Rural Development for information

For information about this or other programs available through USDA Rural Development visit www.rurdev.usda.gov/ia. The agency has 11 offices across the state serving the 1.9 million Iowans living in rural communities. Office locations include a state office in Des Moines, and area offices in Albia, Atlantic, Humboldt, Indianola, Iowa Falls, Le Mars, Mount Pleasant, Storm Lake, Tipton and Waverly.

USDA Rural Development's mission is to deliver quality programs in a way that will support increasing economic opportunity and improve the quality of life of rural residents. As a venture capital entity, Rural Development provides equity and technical assistance to finance and foster growth in home ownership, business development, and critical community and technology infrastructure.