A bit of planning could be all that is needed to help the bottom line of Missouri dairy farmers. At least, that’s the hope of a program being pushed by the State Department of Agriculture.
Dairy farmers, or those wanting to begin a dairy operation, have until the first of November to apply for a Dairy Business Planning Grant of up to $5,000.
Executive Director Tony Stafford with the Missouri Agricultural and Small Business Development Authority acknowledges there’s growing concern about the shrinking dairy industry in Missouri.
“If you look at the 2002 Ag Census versus the 2007 Census, we’ve seen about a 30%-plus decrease in both dairy farms and dairy cows,” according to Stafford.
Stafford says farmers need to sharpen their pencils even more these days as they seek to squeeze out a profit in a highly competitive, global economy. He says planning can be crucial to obtaining credit.
“With this plan in place, they can go to the bank and have a much better chance of getting financing,” Stafford says. “Because they have a very detailed business plan, cash flow analysis and bankers are just much more willing to talk to them if they’ve got some hard numbers.”
Stafford foresees this being valuable to families attempting to pass the dairy farm on to the next generation. In addition to the financial aspect of the operation, the grant also focuses on how the farm would be managed. He says management can become a sticking point in transferring a dairy from one generation to another.
The grant will be expected to finance about 90% of the cost of a business plan, not to exceed $5,000. Ten percent of the cost must be paid by the applicant. Farmers would work with a qualified dairy business planning professional to plan for a dairy startup, to improve the profitability of a current operation or to increase production. Funding for the program comes from the Missouri Soybean Association and the Missouri Dairy Growth Council. The number of grants and the total amount to be paid depends on how many worthy applications are filed.
For more information and to apply, visit the Missouri Department of Agriculture website. Applications must be submitted by 5pm November 1st.