Organic farming and conservation project financing

Separate organic conversion costs from conservation practices

Moving toward organic production can require changes to rotations, handling, livestock management and recordkeeping before the farm receives the price it expects from certified sales. NRCS offers technical and financial assistance through EQIP and its Organic Initiative for eligible conservation work. That assistance addresses approved resource concerns and practices; it is not a blanket subsidy for every cost of converting a business. Begin with a conservation plan and a separate estimate of certification, training and transition-related cash needs.

Finance the transition period as well as the equipment

The financing schedule should allow for altered yields, additional labor and the time required to establish dependable buyers. Ask NRCS which activities require approval before work begins and when payment may follow implementation. A conservation contract, organic certification and a lender’s credit decision serve different purposes, so completing one does not guarantee the others. Compare proposed borrowing against conservative sales assumptions and retain the records needed to show that funded practices were completed according to the agreed specifications and maintained for the required period.