By Alice McFarlane

Strong opening for cash advance program

Apr 4, 2022 | 4:04 PM

MELFORT, Sask.- Farmers have been jumping at the opportunity to secure some cash flow as they prepare for the growing season.

The 2022 Advance Payments Program (APP) is a federal loan program administered by Canadian Canola Growers Association (CCGA). It offers Canadian farmers marketing flexibility through interest-free and low interest cash advances.

There was strong interest in the first day with the issuing of $275 million to more than 1,500 farmers across Western Canada.

CCGA Director of Finance and Operations Dave Gallant said with cost of inputs rising and threats of higher interest rates there was robust uptake of the spring program.

“Farmers who take advantage of a cash advance can see significant savings on their borrowing costs,” Gallant said.

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The first $100,000 of an advance is interest-free and the remaining portion is charged prime less 0.75 per cent. Producers could see an interest saving of several thousand dollars to nearly $20,000, depending on the value of the advance and interest rates.

Gallant said one significant change farmers will see this year is an increase in the commodity advance rates resulting from higher commodity market values. The 2022 advance rate per tonne for wheat is up $34/tonne, and for canola up $111/tonne over 2021 rates.

“This means for the same number of acres on the same crops, farmers will have access to more advance funds,” he said.

CCGA has been managing the cash advance program for 38 years. President and CEO Rick White said during that time they have been working with government to get the APP working better for farmers including increased limits and simplified paperwork processes.

“We’re focused on adding value for farmers,” White said.

CCGA was the first administrator to eliminate administration fees and reduce interest-bearing rates to the current level of prime less 0.75 per cent.

White said every year CCGA has an early application period which this year began on February 9.

“The earliest start date we’ve ever had,” White said.

Farmers can access advances on over 50 commodities including field crops, large and small livestock, organic crops and livestock, and honey.

First-time applicants are being encouraged to contact CCGA who can provide help with the process. For many applicants it only takes 15 to 20 minutes.

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alice.mcfarlane@pattisonmedia.com

On Twitter: @farmnewsNOW