USDA Food Supply Chain Guaranteed Loan Program

Increase capacity and help create more resilient, diverse, and secure U.S. food supply chain

  • Fixed-interest rate
  • 40-year term loans available
  • Start-up or expand

Looking to increase capacity or expand your business?

The Food Supply Chain Guaranteed Loan Program provides financial support to businesses wanting to start or expand middle of the food supply chain activities such as aggregation, processing, manufacturing, storage, transportation, wholesale, or distribution of food.

Food Supply Chain Guaranteed Loan Program Benefits

  • Up to $40 million per borrower 
  • Rural and Urban locations eligible 
  • Fixed-interest rate option available 
  • Up to 40-year loan terms 
  • No USDA initial guarantee or annual renewal fees 
  • Refinancing limited to less than 50% of total loan amount 

Who can apply for this program?

A business engaged in or proposing to engage either directly or through contractual, lease or service agreements with another entity or entities including affiliated entities, in 

  • Aggregating, (e.g., acts as middleman and keeps tight control of the entire experience of its users)
  • Processing, (e.g., food preparation or food packaging, bagging, canning, milling) 
  • Manufacturing, (e.g., primary processing involves handling raw food products, which are cleaned, sorted, chopped, packaged, etc.
  • Storing, (e.g., dry, cold, frozen) 
  • Transporting, (e.g., trucks, trains, boats, air)
  • Wholesaling, (e.g., merchant who work directly with suppliers; agents / brokers work on behalf of manufacturers that aren’t able to sell products on their own and manufacturing distributors who are large enough to have sales teams that can sell directly to the customers), or 
  • Distributing food (e.g., provides food and food related items to food service operators)
     

How can guaranteed loan funds be used?

Examples of fund uses by food supply chain businesses include:

  • Business conversion, enlargement, repair, modernization, or development
  • The purchase and development of land, buildings, and associated infrastructure for commercial or industrial purposes
  • Building or equipping facilities for lease to public or private enterprises engaged in commercial or industrial operations
  • The purchase and installation of machinery and equipment, including manufacturing and Information Technology (IT) systems
  • Working capital

Ready to Apply? Connect with a USDA Lender!

Randy Frescoln

Randy Frescoln

Senior USDA Coordinator
(515) 493-8118 Des Moines, IA
View more about Randy Frescoln

Frequently Asked Questions

The purpose of the program is to facilitate financing for the start up or expansion of activities in the food supply chain to increase incapacity and help create a more resilient, diverse, and secure U.S. food supply chain.

Aggregation, processing, manufacturing, storage, transportation, wholesaling, and distribution.

Yes, projects can be located in urban and rural areas.

Loans up to $40 million per borrower, with fixed interest rates and up to a 40 year repayment term, with no USDA fees which results in lower payments that improve the businesses’ cash flow.

  • Existing business needs either a minimum of 10% balance sheet equity or 10% or more borrower investment as a percent of total eligible project cost. New businesses needs 20–25% balance sheet equity or borrower investment as a percent of total eligible project cost , depending on construction financing requirements.
  • Discounted collateral value must at least equal proposed loan amount. 
  • Unsecured guarantees for the full term of the guaranteed loan and at least equal to the guarantor’s percent interest or membership in the borrower times the guaranteed loan amount are required from any person or entity owning a 20-opercent or greater interest in the borrower.   
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