Throughout my career with the Minnesota Farm Service Agency (FSA), I have met several small and beginning farmers and ranchers, military veterans and disadvantaged producers interested in making a living in production agriculture.

For many, the high cost of purchasing land and equipment can be prohibitive, compelling newcomers to take risks to finance their dreams by relying on credit cards and personal loans.

The U.S. Department of Agriculture understands the needs of these small, beginning and specialty crop producers. Through the FSA's Farm Loan Programs division, the department responded to their needs by developing a new microloan program that will provide up to $35,000 to help bolster these producers during their start-up years.

Likewise, it will assist small, established producers who find themselves in extenuating financial circumstances.

Microloans are like other operating loans. They can be used to purchase livestock, equipment, feed, seed, fertilizer and related supplies. And here's a real benefit when compared to those credit cards and personal loans: the current interest rate for a microloan is 1.125 percent.

But here is how microloans are unlike traditional FSA loans. Applying for them is a simpler, more flexible process. By reducing the application form from 17 pages to eight and modifying requirements for experience, it's easy and far more convenient for both our customers and our employees.

Although some production experience is necessary, there are many producers who may not meet the managerial requirements for traditional loans but may be eligible for a microloan.

FSA will consider an applicant's small business experience, experience with a self-guided apprenticeship and specialized education to meet the prerequisite.

Microloans are perfect for those who want to grow niche crops to sell directly to ethnic markets, farmers markets or consumers.

Young future farmers and ranchers also will benefit. Prospects that previously used an FSA Youth Loan to finance an agricultural endeavor, successfully repaid the debt and are of the "age of majority" according to state law, are eligible for microloans.

The microloan graduates producers to a new level and further prepares them for larger FSA operating loans or commercial loans through the FSA Guaranteed Loan Program.

By supporting America's growers, we help all Americans. We provide a secure, low-cost food supply and make a major contribution to the U.S. economy. And we do these things while nourishing millions.

Glenn R. Schafer

Acting State Ex. Director

USDA - Farm Service Agency