Dairy Farm Profitability & Productivity Program Opportunities for Dairymen through the Minnesota Department of Agriculture

The Rural Finance Authority (RFA) has provided low-cost capital in the form of loan participations with lenders to entry level dairy producers in Minnesota.

• Basic Farm Loan – Enables beginning farmers to purchase farm real estate.
• Seller Assisted Loan – Allows sellers of a farm to fund a portion of the financing essential to the completion of the sale.
• Agricultural Improvement Loan – Provides financing for improvements to a farm.
• Restructure II Loan – Helps farmers who are in good standing with their lenders, but are having trouble cash flowing.
• Livestock Expansion Loan – Provides financing for improvements for livestock production.
• Agricultural Development Bond – Creates a federal tax exemption for banks as well as an interest income exemption to a seller in return for below-market interest rates to the buyer.
• Livestock Equipment Loan Program – Assist in financing the purchase of livestock-related equipment and facilities improvements.

Minnesota is the 7th largest agricultural exporting state in the U.S. with dairy products accounting for $74.2 million of Minnesota’s $2.2 billion total.  In support of the expansion of outlets for Minnesota dairy products the MDA’s Ag Marketing Division participates as a member of the U.S. Dairy Export Council.  Primary U.S. markets for dairy products are Japan, Mexico and Canada.  To broaden dairy markets, the MDA acted as the lead agricultural agency for Minnesota’s 2005 trade mission to China.

As part of Governor Tim Pawlenty’s continuing effort to strengthen the state’s livestock sector, the Minnesota Department of Agriculture (MDA) has hired a livestock siting specialist to aid townships and counties in responding to requests to expand or build new livestock facilities.  Former Stearns County Feedlot Division Director Rob Sip provides training and technical assistance to local government officials on land use, zoning and environmental issues related to animal agriculture.

These teams work one on one with producers to help increase profitability on their operations. These grants are available to producers of every size but focus on small to medium sized operations with an emphasis on improving their management skills. http://www.mndairyinitiative.org/Web/AboutMDI.asp

This program covers 50 percent of the cost of completing a business plan for a dairy operation. Producers who have applied for this grant are exploring the feasibility of expansion, environmental upgrades, stray voltage testing or transferring the operation to the next generation producer. Applications are funded on a first come first serve basis. Dairy Business Planning Planning Grant Program.

The Dairy and Food Inspection Division staff inspects Minnesota's dairy farms, grocery stores and food processing facilities to encourage food safety and quality practices.  Dairy and Food inspectors play a role in assisting the state’s dairy industry in improving milk quality and lowering somatic cell counts.

Provides loans to farmers for water quality improvement practices, includes feedlot pollution abatement.

The MDA has assisted producers looking to add value through on-farm processing. There are eight operations that are actively producing product in MN.

The MDA developed the Methane Digester Loan Program in 1998 to help supplement the funds needed for livestock producers in Minnesota to begin installing digesters on their farms.

MDA provides grant and loan funds to farmers interested in adopting organic and sustainable farming practices and marketing strategies.  Practices funded for dairy include intensive grazing, livestock production that meets organic standards, new parlor designs, on-farm processing, etc.

MDA staff work with individual dairy producers to design grazing plans including fence and water system layout, paddock design, and planting recommendations in conjunction with NRCS.  Contact your NRCS District Conservationist to start the process for getting a grazing plan developed.   

MDA can help dairy farmers learn about federal organic standards and how to obtain organic certification.  The agency offers organic certification cost share assistance (up to $200 per producer per year), and various workshops, conferences, and other learning opportunities. In addition a resource book, Dairy Your Way, helps all dairy producers evaluate housing and parlor options. 

Funds are available through the Department of Employment and Economic Development (DEED) for purposes of modernizing dairy operations.  Producers work through their local agricultural lenders and their local Economic Development Authority.

This is a report that has been generated to assist government leaders in assessing the direct and indirect impacts of livestock processing has on the economy using an economic predictive model.

MDA exhibits at various events with emphasis on three regional events, World Dairy Expo, Farmfest and the Central Plains Dairy Expo putting our best foot forward to try to recruit dairy farms to Minnesota.

MDA is actively supportive of the agribusiness community efforts to support animal agriculture, such as the Minnesota Agri Growth Council and the MN Farm and Food Coalition.