The microloans – identified by USDA as loans under $35,000 were announced by USDA Secretary Tom Vilsack today in Memphis, TN. Vilsack also announced recently that he will be staying on as ag secretary into President Barack Obama’s second term.
USDA said the purpose of these smaller loans secured through the agency are to assist start-up farmers in building their business so that they may eventually move into the commercial credit arena.
“I have met several small and beginning farmers, returning veterans and disadvantaged producers interested in careers in farming who too often must rely on credit cards or personal loans with high interest rates to finance their start-up operations,” said Vilsack. “By further expanding access to credit to those just starting to put down roots in farming, USDA continues to help grow a new generation of farmers, while ensuring the strength of an American agriculture sector that drives our economy, creates jobs, and provides the most secure and affordable food supply in the world.”
The National Farmers Union praised the program. “The next generation of family farmers are critical to the continuation of the long tradition of agriculture in our country,” said NFU President Roger Johnson. “Today’s announcement is a tremendous benefit to those looking to enter into farming.”
“Beginning farmers and ranchers and veterans will greatly benefit from this program, and a streamlined application process is of great value,” said Johnson. “Access to credit is one of the greatest challenges that beginning farmers and ranchers face, and I commend the department for proposing a common-sense way to help alleviate the problem.”
According to USDA’s website, the microloan program features a streamlined application process. Loans may be used for:
- Initial start-up expenses;
- Annual expenses such as seed, fertilizer, utilities, land rents;
- Marketing and distribution expenses;
- Family living expenses;
- Purchase of livestock, equipment, and other materials essential to farm operations;
- Minor farm improvements such as wells and coolers.
- Hoop houses to extend the growing season;
- Essential tools;
- Delivery vehicles.
For information on the program or to apply, farmers are encouraged to contact their local Farm Service Agency office.