Raising the interest-free portion to $250,000 from $100,000 will save participating producers about $5,000 on average.
By Andrew Joseph, Farms.com; Image by krystianwin from Pixabay
The Grain Farmers of Ontario (GFO) have thanked Agriculture and Agri-Food Canada (AAFC) Minister Lawrence MacAulay for increasing the interest-free limit of the Advanced Payments Program for this year.
The Advance Payments Program gives producers access to cash advances of up to $1 million based on the expected value of their crop or other agricultural product. Farmers receive the first $100,000 interest-free, and the AAFC can raise that limit if the season warrants it. This year, the limit of the interest-free portion has been raised to $250,000.
Under the Advance Payments Program, cash advances are calculated based on up to 50 percent of the anticipated market value of eligible agricultural products that will be produced or are in storage. Advances are available on over 500 crop and livestock products across Canada.
“Farmers face a lot of uncertainties and unpredictability. When the weather is bad or prices are low, Ontario’s family farms can be quickly impacted. We appreciate the government’s decision to increase this limit and the access to interest-free loans this will provide farmers,” said Jeff Harrison, Chair of the GFO.
He continued: “Grain Farmers of Ontario has been advocating to increase the limit for some time, and it is good to see that hard work pay off. We look forward to working with the government on continued improvements to this and other risk programs and to any adjustments that might need to be made in the future.”
In 2022, due to exceptional circumstances, the Government of Canada increased the interest-free portion of the Advance Payments Program from $100,000 to $250,000 for the 2022 and 2023 program years. As pressures compounded in 2023, the limit was further increased from $250,000 to $350,000 for the 2023 program year.
The GFO is the province’s largest commodity organization, representing Ontario’s 28,000 barley, corn, oat, soybean, and wheat farmers. For more information on the GFO, visit www.gfo.ca.