USDA launches loan guarantee program to create more market opportunities

USDA launches loan guarantee program to create more market opportunities

WASHINGTON, Dec. 9, 2021 – U.S. Department of Agriculture (USDA) Secretary  Tom Vilsack today announced USDA is deploying $100 million under the new Food  Supply Chain Guaranteed Loan Program to make available nearly $1 billion in loan  guarantees; these loan guarantees will back private investment in processing and food  supply infrastructure that will strengthen the food supply chain for the American people. 

USDA is making the funding available through the American Rescue Plan Act. The  program is part of the Biden-Harris Administration’s efforts to address food system  challenges dating back decades and further exacerbated by the COVID-19 pandemic.  These investments will help essential processing and supply chain infrastructure that will  ultimately deliver more opportunities and fairer prices for farmers, they will give people  greater access to healthier foods, and they will help eliminate bottlenecks in the food  supply chain. 

“The pandemic exposed vulnerabilities and created extreme disruptions in America’s  food supply chain. The reduction in meat processing capacity is just one example of the  supply chain bottlenecks that affect small and midsize farmers,” Vilsack said. “Under the  leadership of President Biden and Vice President Harris, USDA is investing in ways to  improve America’s food supply chain. The funding we’re announcing today will leverage approximately a billion dollars in public and private-sector investments that will  significantly expand meat and poultry processing capacity and finance critical food supply chain infrastructure.” 

Food Supply Chain Guaranteed Loan Program 

Through the Food Supply Chain Guaranteed Loan Program, USDA will partner with  lenders to guarantee loans of up to $40 million to help eligible entities expand meat and  poultry processing capacity and finance other food supply chain infrastructure. Lenders  may provide the loans to eligible cooperatives, corporations, for profits, nonprofits, Tribal communities, public bodies and people in rural and urban areas.  

USDA Rural Development (RD) will administer the loans. Funding may be used to:

• start-up or expand food supply chain activities such as aggregating, processing,  manufacturing, storing, transporting, wholesaling or distributing food.

• address supply chain bottlenecks. 

• increase capacity and help create a more resilient, diverse and secure U.S. food  supply chain. 

USDA is accepting electronic applications from lenders through the Food Supply Chain  Online Application System until funds are expended. Paper applications will not be  accepted. To access the online application system, lenders must submit a request to rdfoodsupplychainloans@usda.gov. For more information, visit  

https://www.rd.usda.gov/foodsupplychainloans or see the notice published in the Dec. 9 Federal Register

USDA Rural Development encourages applications for projects that advance the recovery  from the COVID-19 pandemic, promote equitable access to USDA programs and  services, and reduce the impacts of climate change on rural communities. For more  information, visit https://www.rd.usda.gov/priority-points

Background 

This funding announcement follows the Biden-Harris Administration’s September  announcement about the steps it is taking to address concentration in the meat-processing  industry. It adds a new commitment of $100 million for guaranteed loans on top of the  previously announced $500 million investment to expand meat and poultry processing  capacity.  

These efforts are part of USDA’s Build Back Better Initiative, a comprehensive plan to  invest $4 billion to strengthen the resiliency of America’s food supply chain while  promoting competition.  

As co-Chair of the Biden-Harris Administration’s Supply Chain Disruptions Task Force,  Secretary Vilsack and USDA have brought together industry, labor and federal partners  to address the short-term supply chain disruptions arising from the Administration’s  strong economic recovery. This is one of several key steps that USDA is taking to build a  more resilient supply chain and better food system and to increase competition in  agricultural markets. These steps are pursuant to President Biden’s Executive Order on  Promoting Competition in the American Economy and his Executive Order on America’s  Supply Chains. This initiative will support key supply chain infrastructure investments to  expand and scale existing capacity, as well as support long-term investments in new  operations. 

Rural Development provides loans and grants to help expand economic opportunities,  create jobs and improve the quality of life for millions of Americans in rural areas. This  assistance supports infrastructure improvements; business development; housing;  community facilities such as schools, public safety and health care; and high-speed  internet access in rural, tribal and high-poverty areas. For more information, visit  www.rd.usda.gov. If you’d like to subscribe to USDA Rural Development updates, visit  our GovDelivery subscriber page

USDA touches the lives of all Americans each day in so many positive ways. Under the  Biden-Harris Administration, USDA is transforming America’s food system with a  greater focus on more resilient local and regional food production, promoting competition  and fairer markets for all producers, ensuring access to safe, healthy and nutritious food 

in all communities, building new markets and streams of income for farmers and  producers using climate-smart food and forestry practices, making historic investments in  infrastructure and clean energy capabilities in rural America, and committing to equity  across the Department by removing systemic barriers and building a workforce more  representative of America. To learn more, visit www.usda.gov.  

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