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Starting a Farm Business

Seedling cabbage

I Want to Start a Farm…

A farm is a business. Profits and losses are impacted not only by your expertise and skillsets, but also weather, insects and diseases, market fluctuations, supply chain disruptions, and many more obstacles. While many of those aspects cannot be controlled by a farmer, you can absolutely control your preparations for a successfully-run business.

Successful businesses are a combination of good record keeping, abiding by laws and regulations, staying current on relevant legislation that impacts your products, and knowing where to go when you need help.


How Do I Access Farmland?

Land in Western North Carolina can be prohibitively expensive for beginning farmers. Many farms start by leasing property, or connecting to other resources like incubator farms. There are funding options for outright land purchases – the USDA Beginning Farmer program and working with a lender like Carolina Farm Credit are good places to start.

NC Farmlink  – This resource helps connect landowners to those seeking land on which to farm. 

USDA Beginning Farmers & Ranchers Loans

Incubator Farms  – The concept of providing affordable land and technical guidance to startup farmers that often face obstacles in accessing farmland. The Southern Appalachian Highland’s Conservancy has an incubator farming program at the SAHC Community Farm located in Alexander, NC.


Taxes

Individuals involved in farming must report all profit and losses to the IRS on the Schedule F. Many lenders will require verification through your Schedule F documentation to ensure that you are a bonafide farm.

NC Department of Revenue (DOR) – Farm businesses will report income and losses to the state Department of Revenue. The DOR provides guidance on tax rates for different agricultural products, and issues tax exemption to qualifying farmers. It’s important to note that you must first qualify as a conditional farmer or qualifying farmer before you are able to proceed with obtaining “tax-exempt” status for your farm business. Details of these designations

NC DOR’s Guidance on Sales & Use Taxes on Agricultural Product

Tax Guidance for Small Farmers – Farm Beginnings Collaborative and Organic Grower’s School


Insurance


Funding Sources

If you are considering starting a farm business, you may require or benefit from additional financial assistance. Land loans, operational loans, or microloans can all be utilized depending on a landowner’s situation. Grants are most applicable for established farms that have a history of selling farm products commercially. It can be helpful to inquire with a business advisor or loan officer about potential funding sources.

Pricing


Regulations

There are a variety of regulations that dictate how you may sell your farm products. Explore the local, state, and federal regulations that you may fall under.

Food Safety

The Food Safety and Modernization Act is a set of federal laws that dictate steps produce growers must take to minimize food safety risks. Certain products are exempt from FSMA, and there are also exemptions based upon how much you sell and to which markets your products are sold. It is recommended that produce growers practice Good Agricultural Practices (GAPs). Some buyers will require GAP certification before entering into contracts with growers.

NC State has been a leader in research and outreach of recommended practices for produce growers and the COVID-19 pandemic.

Food Products

A general summary of North Carolina state regulations is available through our partners at Carolina Farm Stewards in their 2012 Summary of Laws & Regulations.

The N.C. Department of Agriculture and Consumer Services’ Food & Drug Protection Division governs many of the regulations small farmers fall under in processing or selling food products. Clear steps for this process, along with labeling information and other important information are outlined. Learn more about general food product information.

NC State University’s Food Business Program can also assist in product development and evaluating the food safety of food products.

NCDA&CS Meat and Poultry Inspection Division – information about aspects/regulations of meat sale.

Have an idea for a food, beverage, or natural product? NC Bionetwork offers support and testing services as well as educational outreach for value-added makers.

Want to sell to grocery stores? This comprehensive guide offers step-by-step considerations.

NC State University has many resources for producers and buyers involved in Selling to Retail and Wholesale Markets.

Certifications

While it’s not required that you have certifications for your farm, many growers seek additional certifications for marketing purposes, and in some cases, to earn more money from their certified products. There are several types of certifications to consider:


Supporting Agencies

Appalachian Sustainable Agriculture Project (ASAP) –  A nonprofit based in Asheville, serving local farmers across the greater Southern Appalachian region. They link farmers to markets and supporters, and help communities connect to local food. They offer several  resources:

  • Digital Farmer Toolkit
  • Online Local Food Guide
  • From Here–  Classified service for the local agricultural sector
  • Business of Farming Conference – held at the end of each February

Carolina Farm Stewardship Association (CFSA) – A nonprofit serving farmers in the Carolinas. CFSA helps people in grow and eat local, advocate for fair farm and food policies, build systems that family farms need to thrive, and educates communities about local, organic agriculture. Their annual conference is not to be missed.

  • Annual Sustainable Agriculture Conference – held in early November

Farm Service Agency (FSA) – The Farm Services Agency operates under the USDA and is the gateway to accessing many federal cost-share programs. Here is a list of contacts for the Buncombe and Madison County offices

NC Farmlink – A resource for connecting landowners and those seeking land on which to farm. If you are seeking land to grow on, or have land that could be leased to farmers, this resource should be your first stop.

Organic Grower’s School (OGS) – A nonprofit based in the Asheville area that serves farmers across the southeast. OGS offers a variety of workshops and programs to landowners, farmers, and homesteaders. For people wanting to develop a farm business, the workshops below are very useful for mapping out the structure of an agricultural enterprise. 

  • Farm Dreams
  • Farm Beginnings 

Small Business Center at AB-Tech – For entrepreneurs in the greater Asheville area, the Small Business Center offers one-on-one counseling and development assistance for new agricultural businesses.

Small Business and Technology Development Center (SBTDC)– These centers are based across the state of North Carolina and offer a multitude of services for beginning agricultural enterprises. The Agribusiness Portal is a new resource brought together by the Center for Environmental Farming Systems (CEFS) and the SBTDC.