Crop farmers who are unable to access their granaries in order to haul their product due to wet or flooded road and fields now have more time to repay cash advances under the Advance Payment Program (APP). Agriculture Minister Gerry Ritz announced a Stay of Default on the repayment of advances until January 31, 2011 for crop producers in British Columbia, Alberta, Saskatchewan and Manitoba who have received a 2009 advance through the Canadian Canola Growers Association (CCGA).
“When muddy roads and wet fields limit access to your granaries, you can’t sell your crop to repay your cash advance,” said Minister Ritz. “The Stay will give farmers a bit of breathing room allowing some time for the ground to freeze in order for them to access their storage bins and market their product.”
“We received many calls from farmers who are not able to haul their grain, and are desperately trying to avoid going into default on their cash advance.” said Rick White, General Manager of the Canadian Canola Growers Association. “This is welcome news for those farmers who are affected. The extension will provide the time they need to meet their obligations under the program.”
Producers who took an advance in the 2009 crop year are facing the prospect of repaying large cash advances this fall, creating significant cash-flow pressures. The Stay of Default was granted following a request from the CCGA to allow the ground to freeze and enable the affected farmers to get to their bins to market their products.
The Stay of Default comes into effect on October 1, 2010, and farmers of more than 25 crops, including canola, oats, flax, rye, mustard, buckwheat, and canary seed are eligible. Crop farmers who received a 2009 APP advance from the CCGA and are adversely affected by the ongoing wet conditions are eligible for the Stay. Farmers will now have more time to repay their advance in full in accordance with the original repayment agreement. The Government of Canada will continue to pay interest on the interest-free portion of farmers’ outstanding advances until January 31, 2011.
Farmers should contact the CCGA for more details.
