You may have heard of agricultural government grants and figured that they are for the giant conglomerates and huge corporate farms. This is true in some cases, but sometimes there are also government grants for beginning farmers or for small farms to expand.
This type of government grant is often available because it (like veterans’ benefits) is something that the lawmakers do not want to defund, due to public sentiment. Farms are, of course, necessary to the wellbeing of a country because it’s much preferable to have domestically-produced food supplies. Relying upon exports for something as basic and necessary as the food that the country’s citizens depend upon for survival, would be a politically foolish strategy that that would leave a country vulnerable and in a weak negotiating position. For that reason, government grants are allocated to farms to ensure they remain strong and able to produce a reliable supply of food.
What sorts of farms typically receive government grants? There are, of course, the ones that grow crops, but the government grants are usually extended to others as well, such as livestock ranches, fisheries (sometimes called “aquaculture), tree farms, and more.
In addition, government grants for farms are also used for the purpose of achieving social equality. For example, in the United States, a government study showed that minority farmers had historically received less funding for their farms and had not had the same opportunities as the non-minority farmers. As a remedy, the government grants were then increased for the minority farmers until a court determined that parity had been reached, after which government grants were allocated in a way that ensured that every qualified farmer had an equal chance at receiving one.
Elsewhere, again in the United States, one of the states wanted to increase the number of women involved in farming and made available government grants for women to enter the agriculture business. From the preceding examples, you can see that government grants for farming have had the twofold purpose of helping to ensure an adequate, ongoing food supply, and also to remove barriers to entry and growth in the industry for all qualified farmers.
The purposes for which government grants for farmers may be used include purchasing land, constructing buildings, buying equipment and supplies, learning new techniques (hiring a consultant, attending seminars, etc.), help to comply with regulations, retooling a farm to switch to a different type of output, and anything else that will help production and efficiency.
In many cases, farmers may receive loans (often at zero percent, so the interest portion is a government grant) to buy supplies or hire seasonal labor, so that they can get there crop or livestock to market and get paid. Farms typically have only one or two big influxes of cash in a year, with the rest of the time involving a lot of expenditures. Government grants and loans help smooth out this pattern and ease the financial burden for farmers.
Now you know the role of government grants in helping the country’s farms, so when you sit down to your next meal, you’ll know that government grants helped provide every forkful you eat.