Governor Hochul Announces $8.5 Million Available to Boost the Dairy Industry Through Round 2 of the Dairy Modernization Grant Program

Governor Kathy Hochul today announced $8.5 million is available to dairy farmers and cooperatives as part of Round 2 of the New York State Dairy Modernization Grant Program. First announced in Governor Hochul's 2024 State of the State address, this grant program provides unprecedented support to New York's dairy farmers and improves dairy supply chain efficiency. The program helps New York's dairy farmers and agricultural marketing cooperatives expand on-farm milk storage capacity and supports projects that will improve the transportation and storage of milk, particularly during emergency events. This funding builds on the more than $21.6 million that was awarded to 103 farms across the state through Round 1 of the Dairy Modernization Program in 2025. A third round of funding, an additional $12.75 million, was dedicated to the program through this year's Budget, bringing the total committed to dairy infrastructure projects under the Governor's leadership to $42.85 million.

"New York's dairy industry continues to be the driver of New York's agricultural economy," Governor Hochul said. "We must ensure that our hard-working dairy farmers have the resources, technology and equipment they need and deserve to continue to meet the demands of the marketplace. Round 2 of the Dairy Modernization Grant will do just that, helping our dairy farmers modernize and make the necessary investments to not only maintain but to also grow their operations."

State Agriculture Commissioner Richard A. Ball said, "New York's demand for milk and dairy products continues to grow, with some of the industry's leading manufacturers responding by expanding their operations here in the state. As New York State continues to be a powerhouse in dairy nationally, it's important that our farmers have everything they need to run a successful operation. Round 1 of the Dairy Modernization Grant Program was a success, and I expect Round 2 to bring even more support for our dairy farmers. I encourage all eligible farmers to take advantage of this opportunity and apply."

State Senator Michelle Hinchey said, "Dairy is New York's largest agricultural sector and a vital contributor to our economy, sustained mostly by family-run, generational operations that need our support. The Dairy Modernization Grant Program was a major success in its first round, providing many New York dairy farmers and processors the resources to expand storage, adopt new technologies, and improve operational efficiency. I'm proud to have helped champion this grant, and I thank the Governor for launching a second round. I encourage all eligible dairies to apply before the October 28th deadline."

Assemblymember Donna Lupardo said, "The first round of the Dairy Modernization Grant Program demonstrated how much these investments are needed across New York's dairy industry. This second round will allow more farmers to upgrade their facilities, improve milk storage and transportation, and make their operations more efficient and resilient. I'd like to thank Governor Hochul and our legislative partners for continuing to support the hardworking farmers who make dairy the cornerstone of New York's agricultural economy."

Farm and Food Growth Fund President and CEO Todd Erling said, "Historic headway was made toward improving efficiencies for New York dairy farmers through Round 1 of this program. But, as evidenced by the sheer number of applications received during that round, there is still a tremendous need for additional support. Dairy farm sizes vary across the state from small generational operations to larger enterprises, and we look forward to helping to further close the gap for farms of all sizes to meet demand with this second round of funding."

The Dairy Modernization Grant Program is administered by the Farm and Food Growth Fund, in collaboration with the New York State Department of Agriculture and Markets. Funding ranging from $50,000 to $250,000 will be awarded to eligible applicants for projects that expand on-farm milk storage capacity; improve efficiencies; and invest in milk transfer systems and cooling technologies. Examples of eligible projects include the purchase/installation of milk storage tanks, including bulk tanks and milk silos; milk tankers for transport; milk pipelines; upgraded glycol chillers; farm milk loading systems; and more.

The request for proposals opens today, August 19, 2026. Virtual open office hours for interested applicants will be held September 9, 2026, at 12 p.m. Applications are due by Wednesday, October 28, 2026.

Full details regarding project eligibility and directions to submit applications can be found at ffgrowthfund.org/dairymodernization. In addition, a new Frequently Asked Questions document can be found in the Resources section of the grant website.

Funding for this program comes as part of Governor Hochul's overarching commitment to the dairy industry. Under the Governor's leadership, the FY 26-27 Enacted Budget provides an additional $12.75 million to dairy farmers for Round 3 of the Dairy Modernization Program and an additional $5.25 million from the Environmental Protection Fund over the previous year for agricultural programs and initiatives that also benefit New York dairy farms, such as the Climate Resilient Farming grant program and the Agricultural Non-Point Source Abatement and Control program, that are helping farms to implement environmentally sustainable practices and combat climate change. Additional allocations for the Farmland Protection Program and the State's Soil and Water Conservation Districts will also support the New York dairy community.

New York State has also supported the expansion of the dairy manufacturing sector in New York, celebrating a number of recent investments across the state, including the $650 million Fairlife production plant in Webster, a $30 million expansion to the Agri-Mark cheese manufacturing facility in Chateaugay, and Chobani's $1.2 billion facility in Rome, helping New York continue to be the leading producer of milk in the Northeast. There are currently nearly 300 world-recognized dairy processing plants across New York.

About the Dairy Industry in New York State

New York State has 2,700 dairy farms that produce more than 16.6 billion pounds of milk annually, making New York the nation's fifth-largest dairy state. The dairy industry is the state's largest agricultural sector, contributing significantly to the state's economy by generating nearly half of the state's total agricultural receipts and providing some of the highest economic multipliers. New York's unique and talented dairy producers and processors contribute significantly to the state's agriculture industry, economy and the health of our communities.