A new federal program will help ag producers add value to their products and sell them locally. Mike Heavrin with the Center for Rural Affairs says the Agriculture Department will make 19.3 million dollars for value-added producer grants. . The grants will make money available for farmers and groups like farm co-ops to do planning and for working capital. Heavrin says the program now in its sixth year has made a big difference in rural communities.
Individual farmers can apply for the grants, as they’re one of four kinds of applicant eligible for the money. You can also be a farm or ranch co-op, a majority-owned producer-based business venture where over half the ownership rests in the control of farmers, or you can be an agriculture producer group. There are grants for two kinds of use — working capital, and planning.
Heavrin says it’ll provide up to half the working capital, as much as $300,000 for inventory, utility and transportation costs, marketing and advertising expenses, and salaries. It cannot be used for production expenses, equipment or buildings. The other grants are for up to half the cost of setting up value-added ag business.
It’ll pay to have business or marketing plans put together, money for feasibility studies, and to pay the cost of organizing a "legal entity" — certain types of corporations. He says instead of sending off grain or livestock to market, farmers can keep a bigger share of the profits from what they produce.
The amount of money from a retail food dollar that goes into the pockets of farmers has gone down to two or three cents. This program’s designed to help farmers recoup a larger portion of that consumer food dollar. Farmers can apply through May 16 for one of the value-added producer grants by visiting the Rural Development website .