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Food System Transformation

The food system of the future needs to be fair, competitive, distributed, and resilient. USDA has announced a framework to transform the food system to benefit consumers, producers and rural communities by providing more options, increasing access, and creating new, more, and better markets for small and mid-size producers. This investment builds on lessons learned from the COVID-19 pandemic and supply chain disruptions caused by Russia’s war in Ukraine.

On this page, you will find all the programs USDA is deploying to transform the food system, details about their status, and links to apply for funding.

BACKGROUND

When the COVID-19 pandemic began, USDA made significant investments through its Pandemic Assistance Program, providing immediate relief to producers, businesses, food workers and others. As the pandemic has evolved and Russia’s war in Ukraine has caused supply chain disruptions, it has become clear we cannot go back to the food system we had before: the Biden-Harris Administration and USDA recognize we must build back better and strengthen the food system across the supply chain, from how our food is produced to how it is purchased, and all the steps in between.

Food System graphic

Food Production

Farmers and ranchers across this country work hard every day to produce the food that feeds their neighbors and communities. The pandemic spotlighted the many challenges they face in accessing markets and capturing a fair share of the food dollar. We know that small and mid-size operations struggle in particular and there are still too many barriers to entry for new farmers. USDA is increasing options for American farmers to process locally, sell locally, and adopt practices that are both good for their businesses and the climate.

In addition to those listed here, USDA has many other programs to support farmers and ranchers. For more information on additional program opportunities, please visit: www.farmers.gov

OPEN PROGRAMS

$100 million for an Organic Certification and Transition Cost Share program that provides pandemic assistance to producers and handlers of agricultural products who are obtaining or renewing their certification under the National Organic Program (NOP). This process can be costly and can be a barrier to market access for limited resource producers. This program is open and applications are due October 31, 2022.

How to Apply

COMING SOON

$200 million for Food Safety Certification for Specialty Crops Program for specialty crop operations that incur eligible on-farm food safety program expenses. These operations incur significant costs to comply with regulatory requirements and market-driven food safety certification requirements each year and getting these certifications opens new market opportunities for the farmers. The ongoing economic challenges due to the COVID-19 pandemic have made meeting those requirements even more financially challenging and more important to have access to additional markets. More details will be coming soon.

Up to $300 million in a new Organic Transition Initiative to provide comprehensive support for farmers to transition to organic production. Organic production provides producers with the ability to demand a premium in the marketplace and thus take home a greater share of the food dollar; there can also be climate and environmental benefits. This initiative will deliver wrap-around technical assistance, including farmer-to-farmer mentoring; provide direct support through conservation financial assistance and additional crop insurance assistance and support market development projects in targeted markets. More details will be announced soon.

Up to $75 million to support urban agriculture. From farms within city boundaries to community gardens, urban agriculture plays an important role in connecting producers and consumers to food, agriculture, and one another while contributing to the local economy. The Agriculture Improvement Act of 2018 authorized the Office of Urban Agriculture and Innovative Production to award competitive grants to support urban agriculture, yet in 2020 and 2021, only six percent of all applications received were funded. USDA will invest $20 million in funding a backlog of applications as well as an additional $10 million increase in money available for the 2022 funding year. Additionally, USDA will invest $40 million in cooperative agreements with organizations to support outreach and training activities for urban farmers. These funds will expand access to nutritious foods, foster community engagement, provide jobs, educate communities about farming, and expand green spaces. More details will be announced soon.

PENDING AWARD ANNOUNCEMENTS

$700 million to support for frontline farm and food workers. The Farm and Food worker Relief Grant program provides approximately $700 million to provide grants to State agencies, Tribal entities, and non-profit organizations to provide support to farmworkers and meatpacking workers.

Food Processing

The pandemic highlighted challenges within the middle of the food supply chain. Consolidated processing capacity created supply bottlenecks, which led to a drop in effective plant and slaughter capacity. Small and midsize farmers often struggled to compete for processing access and were left without an avenue for getting their animals to market. Addressing these challenges is key to transforming food systems. Building more distributed, local capacity will help build resiliency in the face of market disruptions, provide more choices for producers to create value-added products and sell locally, and support new economic opportunities and job creation in rural communities. USDA has already made investments to support new and expanded regional processing capacity and address challenges in the middle of the supply chain, including underinvestment in workforce development and barriers to new entry into the sector.

OPEN PROGRAMS

The Food Supply Chain Loan Guarantee Program backs private lenders that invest in independently owned food processing, distribution and aggregation infrastructure, and other projects along the middle of the supply chain. Independently owned and available infrastructure such as cold-storage, refrigerated trucks, and processing facilities are in short supply but essential to creating a more resilient food system. USDA has deployed $100 million to make more than $1 billion in guaranteed loans available immediately. The program is currently accepting applications.

Learn more

Meat and Poultry Processing: USDA is investing $1 billion in supporting the expansion of diversified, independent meat and poultry processing capacity. For all the information on grants, loans, other programs, and applications: usda.gov/meat

COMING SOON

Up to $600 million in financial assistance to support food supply chain infrastructure that is not covered by the meat and poultry processing program. Independently owned and available infrastructure such as cold-storage, refrigerated trucks, and processing facilities are in short supply but essential to creating a more resilient food system. USDA will make investments to address the limited processing, distribution, storage, and aggregation capacity for a variety of food sectors, including high equipment costs, lack of competition, and limited supply chain and value chain coordination. More details will be coming soon.

PENDING AWARD ANNOUNCEMENTS

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AWARD ANNOUNCEMENTS

Dairy Business Innovation Initiative Supports Long Term Resilience in the Dairy Industry

USDA increased funding ($80 million) to support dairy producers and regional dairy processors, especially those engaged in value-added production and processing. These Initiatives support regional-focused efforts tailored to the needs of dairy farmers and businesses locally. This new investment extends the reach of the DBI program from 30 to 39 states and will expand the capacity of the four initiatives to provide technical assistance and sub-grants.

Learn more

Food Distribution and Aggregation

Having the right infrastructure in the right places to gather, move and hold food where and when it is needed is key to the resiliency of our food system. Efforts to shorten the supply chain from farm to fork provides more income opportunities for producers and more options for consumers to buy locally produced products. At the same time, shortening the supply chain has important climate benefits.

OPEN PROGRAMS

Local Food for Schools: Up to $200 Million to States to Purchase Local Food for Schools

We know that schools and other child nutrition program operators are facing challenges, including supply chain disruptions and other economic disruptions from the pandemic. USDA is investing funding to states to purchase food for schools from local, regional, small, and underserved farmers and ranchers. States can use the funding to purchase foods and beverages that are healthy nutritious, and unique to their geographic area. By increasing the linkage between local farmers, ranchers, and food businesses with schools, USDA is helping to strengthen our local and regional food systems. Deadline is July 20, 2022.

More informationApply

COMING SOON

TEFAP Reach and Resiliency Grants

$100 Million in grants to help expand the reach of the emergency food system in underserved areas including remote, rural, tribal, low-income, or low food access communities. Round 2 opportunity for TEFAP Reach and Resiliency Grants will be coming soon, and USDA will utilize lessons learned from Round 1 awards to inform the Round 2 opportunity (see Award Announcements below).

As the country rebounds from the pandemic, USDA is interested in building back better, so that the Emergency Food Assistance Program’s collective reach spreads to all eligible individuals in need. The key objective of TEFAP Reach and Resiliency grants is to expand TEFAP's reach into remote, rural, Tribal, and/or low-income areas that are underserved by the program.

$400 million to create regional food business centers that will provide coordination, technical assistance, and capacity building support to small and mid-size food and farm businesses, particularly focused on processing, distribution and aggregation, and market access challenges. The business development needs of food businesses are distinct from other small businesses and existing business support networks such as those the Small Business Administration provides are insufficient to developing robust local and regional markets where food businesses flourish. The Centers will be designed to target support to underserved communities in a particular region as identified by the applicant. More details will be coming soon.

$60 million to leverage increased commodity purchases through Farm-to-School. Farm-to-school programs are a proven model of increasing markets for farmers via child nutrition programs while also providing children healthy, fresh food. These grants to states and territories administering farm to school programs will support increased procurement and use of local foods in child nutrition program meals. More details will be coming soon.

Up to $90 million to prevent and reduce food loss and waste. The United States wasted $408 billion worth of food in 2019 – more than a third of the total U.S. food supply. Wasted food results in unnecessary energy and CO2 emissions; reducing food waste can help the United States meet its climate commitments. USDA will invest an additional $30 million in the Community Compost and Food Waste Reduction Program and commission a National Food Loss and Waste Strategy that will produce specific intervention recommendations and an implementation plan in 2022. More details will be coming soon.

PENDING AWARD ANNOUNCEMENTS

$130 Million Increase to Local Food Promotion Program and Regional Food Systems Partnerships

USDA increased funding to these two grant programs to expand and strengthen opportunities for local and regional food producers to sell to institutions, such as universities, hospitals, and settings operated by local, tribal, and state governments. Expanding Food to Institution infrastructure will maximize opportunities for economic growth and ingenuity in the local and regional food system. These grants have generated new income sources for small, beginning and historically underserved farmers; increased local food access across rural and urban communities; and provided platforms for value-added and niche products to shine.

Learn more

AWARD ANNOUNCEMENTS

TEFAP Reach and Resiliency Grants

In June 2022, USDA awarded over $39 million to 38 TEFAP State agencies for TEFAP Reach and Resiliency Round One Projects. These funds will enable State agencies to better serve those in need of emergency food assistance, especially in communities facing barriers to program access.

Local Food Purchase Assistance

List of Signed LFPA Cooperative Agreements

This new $400 Million program supports local, regional, and socially disadvantaged farmers and ranchers through the purchase of domestic local foods that are healthy, nutritious and unique to their geographic area. The food will meet the needs of the population, and serve feeding programs, including food banks, schools and organizations that reach underserved communities. In addition to increasing local food consumption, these awards will help build and expand economic opportunity for local and socially disadvantaged producers.

Learn more

Markets and Consumers

The pandemic exposed and exacerbated the challenges of food and nutrition insecurity in this country. A family in the United States not having access to affordable, nutritious foods is unacceptable. USDA will support new and expanded access to markets for a diversity of growers while helping consumers access healthy foods.

COMING SOON

Healthy Food Financing Initiative. USDA increased funding to the Healthy Food Financing Initiative by $155 million. Many communities lack adequate, affordable access to healthy food and are ‘food deserts’. This program provides grants and loans to entities that offer healthy food in communities that are underserved by grocery stores and other food retailers. The program increases access to healthy foods, provides new market opportunities for farmers and ranchers, stabilizes small and independent retailers, and creates quality jobs and economic opportunity in low-income communities. More details will be coming soon.

Senior Farmers Market Nutrition Program. USDA added $50 million in the Senior Farmers Market Nutrition Program. This program supports nutrition security for seniors by increasing access to locally grown fruit and vegetables. Current levels of funding for this program are insufficient for all States to provide the maximum benefit of $50 per participant per season. More details will be coming soon.

GusNIP Produce Prescriptions. USDA added $40 million to the Gus Schumacher Nutrition Incentive Program (GusNIP) Produce Prescription Program. GusNIP Produce Prescription projects provide financial and non-financial incentives to income-eligible individuals and families to procure fresh fruits and vegetables intended to improve dietary health through increased consumption of fruits and vegetables, reduce individual and household food insecurity, and reduce associated health care costs. Since launching this program following the passage of the Agriculture Improvement Act of 2018, demand has increased by 30 percent each year. Funding will be used to support:

  • GusNIP Produce Prescription applications from fiscal year 2021. Those applications were highly ranked but could not be funded in FY21 due to budget constraints. NIFA has notified eligible organizations and provided additional details and a copy of the application package.
  • Active GusNIP Produce Prescription awardees (from FY19, 20 and 21) who are not already implementing GusNIP COVID Relief and Response awards to apply for project enhancement funding. The funds will expand project reach and extend the period of performance for another three years. NIFA has notified eligible organizations and provided additional details and a copy of the application package.
  • New GusNIP Produce Prescription FY2022 projects. The Request for Applications is open until June 30, 2022.

$25 million to support SNAP technology improvements to modernize the delivery of incentive programs through SNAP’s electronic benefit transfer (EBT) technology. Reliable, affordable, user-friendly technology is important to enabling producers and food businesses to accept SNAP benefits from customers. This will support more project funds going to incentives rather than the administrative costs of delivering the incentive. More details will be coming soon.

$100 million to create a new Healthy Food Incentive Fund, which will support school food authorities to innovate and accelerate their efforts to improve the nutritional quality of school meals to children. With these funds USDA will support peer to peer learning and recognize local programs for their leadership, excellence and efforts to deliver health nutritious food. More details will be coming soon.

PENDING AWARD ANNOUNCEMENTS

Stay Tuned!

AWARD ANNOUNCEMENTS

Stay Tuned!