Financing a value-added agriculture enterprise is challenging. While most funds for new businesses come from personal sources, grant and loan programs may also be available. Check out the opportunities below to see if they fit your business needs.
Federal grant programs currently require a DUNS number and registration in SAMS.gov. Learn about the process to get a DUNS number in this webinar recording.
This information is provided for educational purposes only. Program information may change frequently. Be sure to read current program information available from the administrating agency.
Some programs give priority to counties deemed economically distressed or at risk. Learn more about these indicators and find lists of counties in each group here.
Grant Programs
Farmer Veteran Fellowship Fund
Description
The Farmer Veteran Fellowship Fund is a small grant program that provides direct assistance to veterans who are in their beginning years of farming or ranching. The Fellowship Fund does not give money directly to the veteran, but rather to third-party vendors for items the veteran has identified will make a crucial difference in the launch of their farm business.
Maximum Funding Request
Awards range from $1,000 to $5,000.
Funding Agency
Farmer Veteran Coalition
Website
Forestry, Agriculture, and Rural Markets (FARM)
The FARM program is designed to provide cost share dollars and financial incentives for projects that strengthen and expand Tennessee agricultural and forestry supply chains in response to the weaknesses revealed by the COVID-19 pandemic.
Eligibility
Applicants must be an agricultural, food, or forestry business; or nonprofit agricultural entity in Tennessee or have a project based in Tennessee.
Terms
The FARM cost share program will cover 50% of costs for projects that impact counties that are not classified as economically distressed or at-risk. For projects impacting distressed or at-risk counties, the cost share rate will be 75%. Financial assistance received from the FARM grant program is not a loan and does not need to be repaid. Funding is distributed on a reimbursement basis. Funds will be reimbursed in a single payment after the project is completed.
Minimum award = $25,000
Maximum award = $1 million
Funding Agency
Tennessee Department of Agriculture
Website
Rural Energy for America Program
Description
The REAP program provides guaranteed loan financing and grant funding to agricultural producers and rural small businesses for renewable energy systems or to make energy efficiency improvements.
Maximum Funding Request
Loan Guarantee Percentage
- Published annually in a Federal Register notice. REAP loans approved in Fiscal Year 2023 will receive an 80 percent guarantee.
Renewable Energy System Grants: $2,500 minimum, $1 million maximum
Energy Efficiency Grants: $1,500 minimum, $500,000 maximum
Match Required
- Applicants must provide at least 60 percent of the project cost if applying for a grant only.
- Applicants must provide at least 25 percent of the project cost if applying for loan
Funding Agency
USDA Rural Development
Website
Southern Sustainable Agriculture Research and Education (SARE) Producer Grants
Description
Maximum Funding Request
Individual farmers, $15,000; Farmer groups, $20,000 for a two-year project
Match Required
None
Funding Agency
Southern Sustainable Agriculture Research and Education (SARE)
Website
Specialty Crop Block Grant
Description
Specialty Crop Block Grant Program funds are granted to enhance production and competitiveness of specialty crops, including fruits and vegetables, dried fruits, tree nuts, honey, floriculture and other nursery crops. Eligible organizations include universities, institutions, cooperatives, producers and industry or community-based organizations. The programs aims to support projects that directly affect multiple Tennessee producers and have a positive, long-lasting impact on Tennessee agriculture.
Maximum Funding Request
First-time recipients have a funding limit of $25,000.
Match Required
None
Funding Agency
Tennessee Department of Agriculture administers the grants, which are authorized through the USDA.
Website
Southeast Dairy Business Innovation Initiatives (DBII) Grant
Description
The DBII grant provides grant subawards to current and prospective value-added dairy businesses (cow, goat and sheep) across Tennessee, Kentucky and North Carolina. Dairy businesses must develop, produce, market or distribute dairy products.
Maximum Funding Request
The maximum grant amount is $500,000. The program will support projects of many sizes, but applicants whose request exceeds $150,000 should operate a permitted dairy farm and/or dairy plant, utilize a large portion of local milk and include a robust business plan.
Match Required
None
Funding Agency
The University of Tennessee is administering this grant which originates from USDA Agricultural Marketing Service.
Website
Tennessee Agricultural Enhancement Program: Producer Diversification Cost-Share
Description
The goal of the Producer Diversification program is to encourage agricultural producers to expand or improve their working farm/existing operation through the production of diversified agricultural products. This program provides cost share opportunities for industry sectors of Agritourism, Fruit & Vegetable, Honey Bee, Horticulture, Organic and Value-Added Products.
Maximum Funding Request
The maximum funding request is $12,000.
Match Required
Yes. All approved applicants are eligible for 35% (Standard Producer) cost share. To be eligible for 50% (Master Producer), the approved applicant must complete the special requirements for the sector in which their project is eligible. Special requirements focus on education and include conferences, courses, events, master courses, workshops and specific certifications.
Funding Agency
Website
Tennessee Agricultural Enterprise Fund
Description
The Ag Enterprise Fund (AEF) awards grants to startiing or expanding agricultural, food and forestry businesses; nonprofits, local governments and other entities in Tennessee, or those whose project will be located in Tennessee. The program focuses on value-added and processing projects that benefit other producers or forest landowners. Successful grant recipients must demonstrate a strong potential for impact on local farm income, access to markets, increased capacity or agricultural innovation.
Maximum Funding Request
AEF funds may not be more than 25% of the project’s total budget.
Match Required
Yes, AEF funds may not be more than 25% of the project’s total budget.
Funding Agency
Tennessee Department of Agriculture
Website
Value-Added Producer Grant
Description
The Value-Added Producer Grant program helps agricultural producers enter into value-added activities related to the processing and marketing of new products. The goals of this program are to generate new products, create and expand marketing opportunities and increase producer income. Priority may be received for beginning farmers, socially-disadvantaged farmers or small or medium-sized farms structured as a family farm, a farmer cooperative or those proposing a mid-tier value chain.
Maximum Funding Request
Planning Grants $75,000; Working Capital Grants $250,000
Match Required
Yes, there is a statutory cost share match requirement of 100 percent of the grant amount.
Funding Agency
USDA Rural Development. Find your area office.
Website
Loan Programs
Description
The focus of Microloans is on the financing needs of small, beginning farmer, niche and non-traditional farm operations, such as truck farms, farms participating in direct marketing and sales such as farmers’ markets, CSA’s (Community Supported Agriculture), restaurants and grocery stores, or those using hydroponic, aquaponic, organic and vertical growing methods. There are two types of microloan programs available: Direct Farm Ownership Microloans and Direct Farm Operating Microloans
Maximum Funding Request
Applicants may apply for microloans totaling a combined maximum of $100,000: Up to $50,000 for a farm ownership loan and up to $50,000 for an operating loan.
Funding Agency
USDA Farm Service Agency – Contact your local office.