Agriculture and Agri-Food Canada

Agriculture and Agri-Food Canada

May 04, 2007 13:37 ET

Canada's New Government Delivers Better Cash Advance Program to Farmers

CLAVET, SASKATCHEWAN--(CCNMatthews - May 4, 2007) - Lynne Yelich, Member of Parliament for Blackstrap, on behalf of the Honourable Chuck Strahl, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board, today announced that Canada's New Government is delivering on a commitment to provide a new and improved loan program, to which farmers can now apply. Changes to the Advance Payments Program (APP) means more money for farmers interest free, more time to repay the loans, and a larger number of farmers now eligible to apply for loans.

"Canada's New Government is delivering on our commitment to support farmers as they begin spring seeding. Cash advances are popular with farmers when the time comes to buy fertilizer and other inputs, and we have built on their suggestions to make changes for the better," said MP Yelich. "By improving the Advance Payments Program, more farmers are eligible, and we are providing 40 percent more loan support and more time to repay."

Changes to the Agricultural Marketing Programs Act and the regulations under the Act are in effect and agreements are now being signed with the producer organizations delivering the program. Producers will benefit from significant improvements:

- Cash advances are available for spring and fall under a single program;

- Livestock and additional crops, including berries, are now eligible;

- The limit on cash advances has increased from $250,000 to $400,000;

- The amount of money available interest free has doubled from $50,000 to $100,000; and,

- The maximum time for producers to repay cash advances has been extended from 12 to 18 months.

"Producer groups had suggested several positive changes to the cash advance program to make it more responsive to the needs of today's farming operations and we are pleased the federal government is following through on their commitment to make these improvements," said Ross Ravelli, President of the Grain Growers of Canada. "As spring seeding gets underway, being able to access higher advances with more money available interest free will help producers with the high cost of putting a crop in the ground."

Canada's New Government will have provided a total of $4.5 billion to farmers through Budget 2006 and Budget 2007 measures. Much of this funding is being invested to replace the Canadian Agricultural Income Stabilization (CAIS) program with improved national farm income programs. Together with provincial and territorial governments significant improvements have been made to the margin-based program, and agreement in principle has been reached on a disaster relief framework and expanded production insurance. Work has begun on a new producer savings account with a cost of production component. This new suite of programs represents the federal proposal to replace CAIS.



Changes to the Agricultural Marketing Programs Act (AMPA) and the regulations under the Act are in effect and agreements are now being signed with the producer organizations delivering the program. Changes to the Act were the first piece of legislation to be passed by Canada's New Government and received Royal Assent on June 22, 2006.

The Advance Payments Program (APP) gives producers access to credit through cash advances. Cash advances are secured by the producer's participation in a business risk management program (such as Production Insurance) and/or the value of a producer's agricultural commodities (such as crops) which have been harvested and placed in storage. Producer organizations deliver the APP on behalf of Agriculture and Agri-Food Canada (AAFC). Producers can apply for a cash advance through an eligible producer organization.

The new APP follows through on the government's Budget 2006 commitment to enhance cash advance programming. The changes bring the APP more in line with the financial needs of today's farming enterprises.

A single Advance Payments Program

Previously, AAFC operated two cash advance programs - the Spring Credit Advance Program (SCAP) and the fall Advance Payments Program (APP). The two programs have now merged into a single program, which will streamline program delivery.

More commodities are eligible

Previously, coverage under cash advance programs was restricted to field crops, maple syrup, fur pelts, and honey. Now coverage includes most agricultural products (including livestock, but not including supply managed products) and other crops (such as blueberries and cranberries), broadening accessibility to the APP to most producers in Canada.

Larger cash advances available

APP cash advance limits have increased from $250,000 to $400,000 and the interest-free component of the cash advance has doubled from $50,000 to $100,000.

More time to repay advances

Beginning in April 2007, producers will have up to 18 months to receive and repay their cash advances. Previously, producers had to repay their advances within 12 months.

How to apply

The APP is being delivered by producer organizations on behalf of AAFC. Producers must contact producer organizations directly to apply. More organizations are currently signing agreements to deliver the program.

For more information, producers can call 1-888-346-2511 or check the program web site (

Contact Information

  • Agriculture and Agri-Food Canada, Ottawa, Ontario
    Media Relations
    Minister Strahl's Office
    Ted Yeomans
    Press Secretary