FCC has an extra $5 billion to lend to farmers
March 25, 2020, 3:28 am
Farm Credit Canada (FCC) has received an enhancement to its capital base that will allow for an additional $5 billion in lending capacity, Agriculture and Agri-Food Canada announced Monday..
“Farmers and producers work hard to put food on tables across our country, and they should not have to worry about being able to afford their loan payments or having enough money to support their own families,” Prime Minister Justin Trudeau said. “We are taking action now to give them more flexibility to meet the challenges ahead.”
“Like many Canadians, I am truly grateful for our farmers and food business owners and employees, who continue working hard so we all have quality food on our grocery store shelves and kitchen tables. Their continued work is essential to our plan to manage COVID-19,” Marie-Claude Bibeau, minister of Agriculture and Agri-Food Canad, said. “The measures announced today will provide farmers and food producers across the country with important financial flexibility they will need during these challenging times.”
“If you are a producer concerned about having the cash flow required to plant your crop, or you are a food processor feeling the impact of a lost sale due to the financial downturn, FCC is here to support you in these uncertain economic times,” said Michael Hoffort, FCC president and CEO.
“It’s in times like these that we are reminded how important Canadian producers and food processors are to our nation and to feeding the world.”
Hoffort adds that FCC will use its resources to find solutions that offer the best chance for recovery going forward so the industry emerges stronger. Initially, the focus will be on assisting the industry in addressing cash flow challenges so that businesses can remain focused on business-critical functions rather than worrying about how to access funds to keep operating through this difficult time.
“Supporting the industry will also take strong collaboration between banks, credit unions, FCC and other financial institutions,” said Hoffort.
“FCC has served as a strong and stable industry presence for more than 60 years, and this current situation is no different. We will be working in partnership with other financial providers to offer the solutions needed by the agriculture and food industry to take on the challenges ahead.”
As part of its ongoing support efforts, FCC also is asking existing customers who have cash flow or other financial concerns to contact the organization to discuss alternatives, such as loan payment deferrals and products available to assist with cash flow needs.
“Each business’s financial situation is unique, so there may be a combination of options considered,” Hoffort said.
“The bottom line is that FCC is being supported by our shareholder to play a bigger role in supporting the success of the Canadian agriculture and food industry across Canada. The sooner we can discuss potential challenges, the more options we have.”
Customers facing financial pressure are encouraged to contact their FCC relationship manager or the FCC Customer Service Centre at 1-888-332-3301 to discuss their individual situation and options.
FCC is Canada’s leading agriculture and food lender, with a loan portfolio of more than $38 billion.
APAS welcomes FCC announcement
The Agricultural Producers Association of Saskatchewan (APAS) is welcoming the announcement of five billion dollars to assist farm financial liquidity through Farm Credit Canada and an extension to repayment for the Cash Advance program.
“While much of the Canadian economy has shut down, Saskatchewan farmers are getting ready to put in this year’s crop, and they need to know that credit is available to allow them to seed,” said APAS President and farmer Todd Lewis. “This announcement is a good first step to help spring seeding move forward.”
Lewis pointed out that more must be done in the coming weeks to ensure the viability of Canada’s farm economy.
“Our net farm incomes have dropped by over 40 per cent in the last two years, and many farm operations have been impacted by low commodity prices, poor weather, and trade and transportation disruptions. With COVID-19 we are now facing unprecedented business instability going into the 2020 production year and our Business Risk Management programs do not provide us with an adequate financial backstop needed to manage these risks,” Lewis explained. “We need further measures to ensure that we have the cash flow and financial means needed to produce food for Canadians and for export customers.”