USDA Announces Grant Opportunities for Value-Added Ag Programs, Notes NCGA (03-09-05)

The U.S. Department of Agriculture’s (USDA) recent announcement of the availability of $14.3 million in grants for value-added agriculture and renewable energy ventures supports the National Corn Growers Association (NCGA) efforts to expand the ethanol industry and create new business opportunities for corn growers.

In announcing the grants, Agriculture Secretary Mike Johanns said, “Priority consideration will be given to grant applications that have at least 51 percent of project costs dedicated to activities for a bioenergy project.” Qualifying renewable energy projects involve ethanol, biodiesel, wind energy production or the use of biomass to generate energy.

“The grants are designed to support the development of value-added agriculture business and to support President Bush's energy plan to develop alternative sources of renewable energy,” Johanns said.

Mark Schwiebert, vice chair of NCGA’s Public Policy Action Team, said, “Grants like these will help in our continuing effort to position agriculture as an asset that benefits not only the rural communities, but also consumers who are the end users of our products.”

He added that NCGA’s Future Structure of Agriculture Task Force released in February a report “Taking Ownership of Grain Belt Agriculture,” which identifies potential ways to accelerate growers' investments in value-added enterprises. Schwiebert said the value-added grant program addresses one of the report’s specific recommendations to policy makers, which is to “foster and fund value-added education and rural entrepreneurship.”

According to NCGA, engaging growers in the processing and marketing of value-added products is an important strategy for enhancing farm profitability and rural economic development. NCGA encourages producer investment in start-up farmer-owned processing facilities while establishing resource centers to support these endeavors with adequate marketing and technical expertise.

The USDA grants are available to independent producers, agricultural producer groups, farmer or rancher cooperatives and majority-controlled producer-based business ventures. The grants will fund two activities: planning activities needed to establish a viable value-added marketing opportunity for an agricultural product (e.g. conduct a feasibility study, develop a business plan, develop a marketing plan); and funding to acquire working capital to operate a value-added business venture that will allow producers to better compete in domestic and international markets.

The awards will be made on a competitive basis and applications must be received no later than May 6. Detailed information about application and program requirements were published in the March 7 Federal Register. For more information on the rural program grants, go to www.rurdev.usda.gov.