What Is Value-Added Agriculture, and How Can It Make a Huge Difference in Your Business?David Cawthon
What if there were a way for farmers and agriculture producers to enhance their profitability and diversify their product offerings. You’re in luck … there is! In recent years, value-added agriculture, as it’s called, allows those tied to ag to add value to their agricultural products, tap into new markets, create unique products and increase their overall revenue.
In Missouri, the combination of agricultural strengths and a robust support system makes it an ideal environment for pursuing value-added production. So if you’re connected to the ag space in the Show-Me State, listen up because this is a genius way to expand your profits and reach new customers.
What is Value-Added Agriculture?
Value-added agriculture refers most generally to manufacturing processes that increase the value of primary agricultural commodities.
A value-added activity is an activity traditionally performed at another stage in the supply chain or one that has never been performed. For example, a farmer could sell produce directly to restaurants or host festivals at the farm.
Through value-added production and marketing, farms convert an agricultural commodity or byproduct into a good that has more value than the inputs used to make it. Because the farm creates added value, it also can capture a higher price than it could if the inputs were sold alone.
These activities may increase net farm incomes, but producers should first see if the value-added activity is right for them.
There are many ways to add value to agriculture and increase net farm income. Starting a new enterprise has risks, so ag producers should carefully assess alternatives. Luckily, Missouri has several resources in place to help.
The Missouri Agricultural and Small Business Authority is a division of the Missouri Department of Agriculture that makes grants, loans, loan guarantees and tax credits available to Missouri farmers, independent producers and agribusinesses. There are several grants and loan programs in Missouri that provide specialized support for value-added producers:
- The Missouri Agribusiness Revolving Loan Fund offers financing to qualifying Missouri agribusinesses, such as value-added agriculture enterprises, agriculture support businesses, marketers or retailers of agricultural products and businesses with emerging agricultural technology.
- The Missouri Value-Added Agriculture Loan Guarantee Program provides a 50% first-loss guarantee to lenders who make agricultural business development loans for agricultural property used for the purpose of processing, manufacturing, marketing, exporting and adding value to an agricultural product.
- The Missouri Value-Added Agriculture “Farm to Table” Grant Program provides funding for Missouri businesses to access resources for accessing and processing locally grown agricultural products for use in institutions within the state.
· The Missouri legislature has created Show-Me Entrepreneurial Grants for Agriculture program to help farmers, small businesses and higher education institutions add value to agricultural products in Missouri or provide educational opportunities to those seeking to do so.
Not sure which is right for you? Call MOSourceLink at 816-235-6500 or tell us what you need here, and we’ll craft your own custom plan of next steps and which of the state’s 600+ resources can help your unique business, right now.
The Missouri Agriculture, Food and Forestry Innovation Center offers resources and technical assistance to help Missouri agricultural producers successfully pursue value-added agricultural production and marketing.
Experienced center counselors provide free, customized business assistance to Missouri value-added producers.
“We’re here to mentor, coach, support and challenge the way business owners think about their business and the type of information they have as they make decisions,” says Mallory Rahe, associate director of the center.
The University of Missouri’s new Food Processing and Safety Lab helps people who make and sell processed foods ensure they are safe. Food safety is paramount as entrepreneurs start new food businesses. The lab is a one-stop solution center to help beginners and medium- and large-scale food processors in Missouri address food safety issues and comply with state and federal regulations.
The new lab is offering an in-person Better Process Control School Training for food processors Aug. 1-3, 2023. The three-day training will be at the Eckles Event Center on the MU campus in Columbia.
Lakshmikatha “Kantha” Channaiah, MU assistant professor and state extension food processing and safety specialist, will conduct the training. As Missouri’s only food process authority, Kantha validates processing protocol to ensure businesses offer safe food products.
Having a food process authority in the state is an amazing resource for food producers and food entrepreneurs in the state,” Rahe says. “For producers who really want to scale up into more markets, having access to this kind of training within the state is really important.”