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Financing Cold Storage Facilities Through USDA Loans

The FSFL program is crucial for funding your farm’s storage needs. It offers low-interest financing to help you build or upgrade facilities. This includes silos, grain bins, and cold storage buildings for perishable commodities.

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Overview of the USDA Farm Storage Facility Loan Program

Overview of the USDA Farm Storage Facility Loan Program

Financing Options

The FSFL program is crucial for funding your farm’s storage needs. It offers low-interest financing to help you build or upgrade facilities. This includes silos, grain bins, and cold storage buildings for perishable commodities.

The loans can cover new construction as well as renovations or expansions. For example, if you need a larger freezer space for harvested crops, FSFL could be your solution. The program aims to make these essential investments more affordable.

USDA Support

The United States Department of Agriculture (USDA) bolsters agricultural infrastructure. Through programs like the FSFL, they provide financial backing that strengthens food systems nationwide.

Your farm benefits directly from this support by accessing better storage solutions. This means less waste and improved market opportunities due to extended product shelf-life.

Program Impact

Understanding the scope of the FSFL is crucial for realizing its impact on your operations. It covers various types of storage units and handling equipment necessary for modern farming practices.

With FSFL assistance, farms have seen enhanced efficiency in storing products safely until market prices are favorable. Your operation could experience similar improvements with proper investment in storage facilities funded through this program.

Eligibility Criteria for Farm Storage Facility Loans

cold storage facilities

USDA Standards

To secure cold storage financing, your farm must meet USDA standards. These include being an eligible farmer or rancher and having a satisfactory credit history. Your farming operation should demonstrate a real need for cold storage facilities to store commodities.

Firstly, check if the USDA recognizes you as an eligible producer. You’ll need records of producing and marketing crops in recent years. A good credit score is crucial, too; it shows you’re reliable in repaying loans.

Key Requirements

Understanding the key requirements is essential before applying for FSFL. The main factors are farm size, income levels, and the necessity for improved storage solutions.

  • Your operation should be small to mid-sized.
  • Ensure your average annual income from all sources is at most $900,000.
  • Demonstrate that additional cold storage will significantly benefit your agricultural business.

If you meet these criteria, chances are high that you qualify for FSFL assistance.

Assessing Needs

Lastly, evaluate how new or upgraded facilities would impact your operations. Consider current needs and future growth potential when considering facility improvements or expansions.

Reflect on whether increased cold storage capacity could lead to better market prices during off-seasons or reduce losses from spoilage. Consider if enhanced equipment might increase efficiency on your farm as well.

Step-by-Step Application Process for Farm Storage Facility Loans

Process for Farm Storage Facility Loans

Gather Documents

Before diving into the application, you need to collect essential documents. This step is crucial for a smooth process. Your documents should include proof of eligibility, detailed cost estimates, and plans for your storage facility.

Firstly, ensure you have records that show your involvement in farming activities. Next, get quotes for equipment like handling trucks or packing supplies if they’re part of your project. Keep all financial records up-to-date; these will demonstrate your ability to repay the loan.

USDA Resources

The USDA offers resources designed to help with applications. Please take advantage of them, as they can provide guidance and clarify doubts during this process.

Visit their website or local office to find templates and checklists that make applying easier. They outline every step and remind you of deadlines so everything is noticed. Look especially for information related to record keeping, which is vital when applying for government financing.

Advantages of Farm Storage Facility Loans for Agricultural Producers

Advantages of Farm Storage Facility Loans for Agricultural Producers

Financial Benefits

After navigating the application process, you’ll find that Farm Storage Facility Loans (FSFL) offer significant financial perks. These loans can help you build or upgrade storage facilities, including silos, barns, and packing sheds. The immediate benefit is clear: you can access funds at a lower interest rate than most commercial loans.

By utilizing FSFL, your agribusiness can invest in assets that would otherwise be out of reach due to upfront costs. This financial support allows for constructing new storage units or enhancing existing ones without depleting your operational capital.

Loss Reduction

One primary concern for producers like yourselves is post-harvest loss. With FSFL-funded improvements in storage infrastructure, this challenge becomes more manageable. Better storage conditions mean less spoilage and waste, positively impacting your bottom line.

Investing in quality storage solutions preserves your products and extends their marketability period. This means you have more time to sell at optimal prices rather than rushing due to fear of product degradation.

Long-Term Gains

Consider the long-term advantages that come with enhanced storage capabilities. By securing FSFL financing for improved facilities, you’re investing in your farm operations’ future profitability and sustainability.

These investments often lead to increased efficiency in handling crops or livestock. They may even open up new markets that require specific standards for storage conditions previously unattainable to you.

Types of Commodities and Facilities Covered by FSFL

cold storage facilities

Eligible Commodities

The Farm Storage Facility Loan (FSFL) program helps you store your products safely. It covers many commodities. These include grains, dairy products, and even flowers. If you grow these items, the FSFL can help.

Eligibility is vital for financing. For example, corn and wheat are included. So are soybeans and oats. You can also store milk or cheese under this program.

Loan Terms and Financial Assistance for New and Underserved Farmers

Financial Assistance for New and Underserved Farmers

Favorable Conditions

Understanding loan terms is crucial for your success. New farmers often find tailored conditions in the Farm Bill. These can include a microloan option, simplifying paperwork, and funds access.

The Farm Service Agency (FSA) offers these loans with new entrants in mind. You might see lower interest rates or flexible credit requirements. This helps you start without heavy financial burdens.

Special Provisions

For underserved groups, there are special provisions available. These aim at leveling the playing field. The FSA recognizes that everyone should have a fair chance at farming success.

Depending on eligibility, you could benefit from targeted funding assistance or reduced interest financing. Such support ensures that all farmers have access to the necessary resources.

Financial Assistance

Through FSFL, exclusive financial options await you. They offer various assistance like share assistance for equipment costs or renewable biomass projects.

Take advantage of maximum loan amounts designed to fund your storage needs for commodities like grain sorghum. Remember, each choice impacts future payments and overall credit health.

Understanding the Food Supply Chain Guaranteed Loan Program

Food Supply Chain Guaranteed Loan Program

Program Overview

The Food Supply Chain Guaranteed Loan Program offers your cold storage business a lifeline. It provides financing that helps maintain and improve facilities, ensuring fresh produce stays chilled from farm to table.

This program complements existing USDA loans by focusing on strengthening the food supply chain. For instance, this loan can be pivotal if you’re expanding your cold storage capacity. It’s not just about keeping food at the right temperature but supporting an entire food distribution ecosystem.


Understanding how these programs differ is crucial for making informed decisions. The Farm Storage Facility Loan (FSFL) primarily assists in buying or upgrading storage facilities for eligible commodities. In contrast, the Food Supply Chain Guaranteed Loan (FSCGL) has a broader scope.

With FSCGL, you can secure funding for cold storage units, processing plants, and distribution centers. This means if you’re looking to diversify operations beyond just storing products, FSCGL could be more suitable.

Additional Avenues

Your business might need more than one type of support to thrive. Luckily, USDA’s suite of programs includes additional funding sources:

  • Grants for energy efficiency improvements.
  • Loans targeting specific sectors like dairy or meat processing.

These avenues provide flexibility in managing financial needs while contributing to a robust food supply infrastructure.

Contacting USDA for Cold Storage Financing Programs

USDA for Cold Storage Financing Programs

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Personalized Assistance

To get help from the USDA, you start by contacting their experts. Your journey begins with personalized assistance. You can find a local service center or use direct contact methods like phone or email.

Once connected, ask about loans for cold storage facilities. These experts guide you through your options and explain what’s needed for success. They understand every borrower is unique and offer tailored advice to meet your needs.

Remember, they’re there to assist with your specific financing needs. Feel free to share details of your project so they can provide the best guidance possible.

Local Guidance

Your local USDA service center is a valuable resource when seeking cold storage financing. Here’s how you can tap into this support:

  1. Locate your nearest center using the USDA online locator.
  2. Schedule a visit or call them directly for convenience.

At these centers, staff are well-versed in loan programs that could benefit you, including those focused on cold storage solutions, which are essential in maintaining food quality and safety throughout the supply chain.

They’ll walk you through the application processes and discuss eligibility criteria and repayment terms that align with your business plans and financial capacity.

Watch Our Videos

Are you ready to take your business to new heights? Discover the power of the USDA Business Industry Program. With its comprehensive eligibility criteria, underwriting requirements, and loan guarantees, this program provides accessible and affordable loan options for businesses in rural areas.

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Here are some answers to Frequently Asked Questions.

Who is eligible for the USDA Farm Storage Facility Loan Program?

Farmers with qualifying production history and credit scores are eligible. They must demonstrate storage needs based on their operation size.

How do I apply for a Farm Storage Facility Loan?

Start by contacting your local USDA Service Center. Then, complete the application form provided, gather the necessary documents, and submit them as instructed.

What benefits do Farm Storage Facility Loans offer to farmers?

These loans provide low-interest financing to build or upgrade storage facilities, which can lead to increased market opportunities and better crop management.

Can new or underserved farmers get special assistance under FSFL?

They may receive lower interest rates and potential waivers on specific requirements. This helps level the playing field for those starting out or from underserved groups.

What types of commodities are covered by FSFL?

Grains, dairy products, meats, and more qualify. If it’s a farm commodity that requires cold storage or dry bins, chances are it’s covered.

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