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USDA-RD offers grants for value added ag efforts

By Staff | Mar 27, 2009

DES MOINES – Timothy Helmbrecht, acting state director for USDA-Rural Development in Iowa, announced last week that Value Added Producer Grants will again be available to assist independent agricultural producers enter into value-added activities.

Since 2001, 120 producers and businesses in Iowa have been awarded more than $20 million through this program to help them add value to the commodities they produce on their farm,” Helmbrecht said. “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.”

A total of $15 million will be available through this nationally competitive program in 2009.

The 2008 Farm Bill expanded the Value Added Producer Grant program and makes 10 percent of available funds available to local and regional supply networks linking producers with businesses and cooperatives that market value-added agriculture products.

In addition, 10 percent of available funds will also be reserved for beginning farmers or ranchers or socially disadvantaged farmers or ranchers.

Other new features to the program this year will include a simplified application process for project proposals requesting less than $50,000.

Value Added Producer Grants are available to independent producers, agricultural producer groups, farmer or rancher cooperatives, and majority-controlled producer-based business ventures. Grants are available for planning or working capital purposes.

Planning grants can be used for feasibility studies, marketing and/or business plans. Grant funds 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 just starting out. If a business venture has been operating for more than a year, it does not qualify for a working capital grant.

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.

“The Value Added Producer Grant program creates jobs and improves the financial returns for producers and farm families across rural Iowa, and rural America,” Helmbrecht said. “I hope producers with interest in starting our expanding their value-added business will give us a call.”

The official deadline for applying for the 2009 Value Added Producer Grant Program has not been published in the Federal Register but the deadline is anticipated to be in early spring.

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