Last week, the Minister of Agriculture and Agri-Food, the Honourable Marie-Claude Bibeau, announced that the interest-free portion of the Advance Payments Program will be increased from $100,000 to $250,000 for the 2022 and 2023 program years.
The Advanced Payment Program (APP) is funded by the Government of Canada and administered by the Agricultural Credit Corporation (ACC). This program provides cash advancements to producers to help cover input costs.
As a result of this new increase, participating producers will save on average $5,500 in interest costs over the next two years and will be able to borrow up to $1 million. In the past, the first $100,000 has been interest-free, while the remaining $900,000 is set at the prime interest rate. Participating producers will have up to 18 months to repay the balance.
Cash advance payment amounts will be calculated based on up to 50% of the anticipated market value of the eligible agricultural products that will be produced or are in storage. Typically, cash advances are issued in two installments, 60% upfront and 40% after seeding is confirmed. However, it was announced by the Ministers Office in April that they would temporarily wave the requirement for two installments. Producers can currently receive 100% of their payment when approved.
Farmers interested in applying, should contact the Agricultural Credit Corporation at 1-888-278-8807 or email them at firstname.lastname@example.org