USDA Offers $30 Million in Grants for New Product Development

May 13, 2015
The USDA is making the Value-Added Producer Grant (VAPG) available to farmers, ranchers and food entrepreneurs to develop new product lines.

Agriculture Secretary Tom Vilsack said on May 8 that the U.S. Department of Agriculture is making $30 million available to farmers, ranchers and food entrepreneurs to develop new product lines. The funding will be made available through the Value-Added Producer Grant (VAPG) program to support beginning, established and socially-disadvantaged farmers and ranchers expand their businesses.

Details on applying for the grants can be found in the May 8 Federal Register (page 26528). The deadline to submit paper applications is July 7, and electronic applications can be submitted through on or before July 2.

The USDA has awarded 853 such grants since 2009, totaling $104.5 million. Roughly 19 percent of the grants and 13 percent of total funding has been awarded to beginning farmers and ranchers.

"Farmers and ranchers are creative people who, with a little help, can put that creativity to work and improve the bottom line for their operations," stated Vilsack. "Value-Added Producer Grants enable them to develop new product lines to grow their businesses and expand their contributions to our nation's economy. This support is especially important for beginning farmers, military veterans engaging in farming and smaller farm operations participating in the local and regional food system."

The VAPG grants can be used to develop products from raw agricultural products or to create additional uses for existing product lines. Military veterans, socially disadvantaged and beginning farmers and ranchers as well as operators of small- and medium-sized family farms and ranches; farmer and rancher cooperatives; and applicants that propose mid-tier value chain projects are given special priority in applying for VAPGs. Priority is also bestowed to group applicants who seek funding for projects that "best contribute" to creating or increasing marketing opportunities for these type of operators, according to the USDA.

During the 2013-2014 funding period, almost half of the grants were awarded to farmers and ranchers developing products for the local food market. Congress increased funding for the VAPG program when it passed the 2014 Farm Bill. That law builds on historic economic gains in rural America over the past six years, while achieving meaningful reform and billions of dollars in savings for taxpayers.

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