Photo: Screencap via twitter.com/@CFAFCA
In a significant move to support Canadian farmers facing financial challenges, the federal government temporarily increased the interest-free limit of the Advanced Payments Program (APP) from $100,000 to $250,000 in 2022 and then to $350,000 in 2023. This increase in interest free loans was pivotal in helping farmers manage cash flow for purchasing critical inputs such as feed, seed and fertilizer.
The Ontario Federation of Agriculture (OFA) has been at the forefront, advocating for these temporary increases to the interest free portion to become permanent fixtures of the APP. We have written to Minister Freeland on multiple occasions and as recently as February 9, 2024. OFA also submitted a resolution to the Canadian Federation of Agriculture (CFA) in 2023 to lobby to make these temporary increases permanent.
The APP has played a crucial role in helping farmers navigate cash flow challenges, inflation, rising interest rates, and geopolitical pressures over the past several years – issues which remain challenges in 2024. In our first ever farm business confidence survey, OFA members overwhelmingly told us that farm input costs are the number one issue they are worried about in 2024, this speaks to the urgent need for a permanent increase in the interest free portion of the APP to $350,000.
Despite the temporary relief provided, the interest-free limit has reverted back to $100,000 for the 2024 production year, which is a significant step back in support for farmers at a time they can least afford it. The challenges of high input costs, cash flow, profitability and financial stability continue to loom large for farmers in Ontario and across Canada. Given these persisting challenges, the OFA is calling on the government to solidify the increase to the interest-free loan limit under the APP as a permanent measure, providing much-needed financial relief and a level of confidence for farmers who are faced with making significant and necessary investments in the upcoming production year.
The OFA remains committed to working on behalf of all Ontario farmers, advocating on their behalf to all levels of government.