DIVERSIFYING AGRICULTURAL SYSTEMS: AN EXTERNAL ANALYSIS OF STATE VALUE-ADDED PROGRAMS

Abstract

An increasing number of farmers in the United States are finding more opportunity to participate in value-added activities beyond their commodity production. Issues' such as low farm income, increasing marketing margins, and a desire to enhance demand for local commodities-generate more interest in identifying suitable value-added activities. Many states are providing programs to help promote and support farmers interested in leading the development of new food products. This paper examines the objectives and development strategies of several value-added state programs. Special attention is paid to the extent to which the programs create opportunities for farmers in different income groups. Programs profiled in this research include Iowa's Rural Economic Value-Added Mentoring Program (REVAMP), North Dakota's Agricultural Utilization Research Institute (AURI), Minnesota's Agricultural Products Utilization Commission (APUC), and other centers and programs in Colorado, Tennessee, Mississippi, and Oklahoma. A survey is conducted of the center directors to provide a profile of each program's scope and state's objectives, development strategy, and performance measures. This paper assesses the effectiveness of variously structured value-added programs as stated by the survey; it also summarizes recommended strategies for improvement. Cost considerations and long-term justification of these value-added centers is also considered. Institutional design, recommendations, central policy issues, and program performance measures are discussed. States considering the implementation or expansion of such programs will want to evaluate their design based on these findings.Agricultural and Food Policy,