Stay of default implemented on advance payments
OTTAWA – Prime Minister Justin Trudeau announced $5 billion in funding to Farm Credit Canada to help the agrifood sector weather to the COVID-19 crisis and a stay of default on repayments of funds farmers borrowed under the Advance Payments Program.
The FCC will use the new funding to lend to producers to cope with cashflow issues and to processors who are impacted by lost sales so the two groups can remain in business.
Also, farmers who have an outstanding Advance Payments Program (APP) loan due on or before April 30 will receive a Stay of Default, allowing them an additional six months to repay the loan, Trudeau said.
“This important measure, which represents $173 million in deferred loans, will help keep more money in farmers’ pockets during these critical months,” Trudeau said.
The Stay “will also provide farmers the flexibility they need to manage their cashflow when facing lower prices or reduced marketing opportunities. Applicable farmers who still have interest-free loans outstanding will have the opportunity to apply for an additional $100,000 interest-free portion for 2020-2021, as long as their total APP advances remain under the $1 million cap.
The federal government “remains committed to supporting Canada’s agricultural sector to ensure that farmers and businesses have the support they need to provide for their families and all Canadians during this critical time,” Trudeau said.
The new deadlines for outstanding Advance Payments Program loans are as follows:
September 30, 2020: 2018 cash advances for grains, oilseeds, and pulses and 2018 cash advances for cattle and bison.
October 31, 2020: 2019 cash advances on flowers and potted plants.