Session E: Economic Opportunities
Chair: Dennis Lamm, Colorado State University, Fort Collins, Colorado
Moderator: Cliff Herron, USDA-Farm Service Agency, Washington, DC
Business Opportunities for Small Farmers
USDA - Rural Development
The Rural Business Cooperative Service (RBS) has several programs which can provide financial assistance to producers of agricultural products:
Business and Industry (B&I) Guaranteed Loan Program. The B&I program guarantees loans made by eligible local lenders to businesses which create and maintain employment, and improve the economic climate in rural areas. The program typically guarantees losses on loans of up to 80 percent of the original loan plus accrued interest. Loans can be made for up to $10 million for virtually any legal business activity. Farmers could benefit from the B&I program in a number of ways such as establishing agricultural products processing and/or marketing businesses.
Examples of the type of businesses which assist farmers and for which B&I loans have been guaranteed include:
2. Seed handling and processing;
4. Livestock and poultry processing; and
5. Other value added processing and marketing operations
The 1996 Farm Bill contains authorization for the establishment of a Cooperative Stock Purchase Program as an autho-rized purpose of the B&I program. Under this program a B&I loan could be guaranteed to a farmer for the purchase of stock in a start up cooperative which would process agricultural products produced by the farmer. Farmers can establish a value added feature to their product with this feature. For example, stock proceeds could capitalize a business for the purpose of processing and/or marketing beef produced by the farmer members of the cooperative.
For further information contact the Rural Development Office in your State listed under U. S. Govt. in the phone book.
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