The federal government was able to implement new cash advance rules faster than originally anticipated with help from the Canadian Canola Growers Association.
Federal Agriculture Minister Marie-Claude Bibeau said during a May 24 conference call that it could take a couple of months to revise the regulations.
That timeline didn’t sit well with canola farmers who lost their top market when China pulled the export licences of Richardson International and Viterra over phytosanitary concerns.
But it turns out the new Advance Payment Program rules were in place less than two weeks after Bibeau’s conference call.
“We certainly worked very, very closely with Agriculture and Agri-Food Canada to kind of trim these timelines down to what was workable for all of us,” said CCGA chief executive officer Rick White.
“Together we got the timeline shortened up.”
The amendments to the Agricultural Marketing Programs Regulations permanently increase loan limits to $1 million from $400,000 for all producers.
They also increase the interest-free portion on canola advances to $500,000 from $100,000 for the 2019 program year. For all other commodities, it remains at $100,000.
“Our government stands behind our farmers and is taking numerous concrete actions to help them manage the current market disruption challenges,” Bibeau said in a news release.
“These measures will help ensure our hardworking Canadian producers have the flexibility they need to manage their cash flow.”
The CCGA administers 97 percent of the advances doled out in Western Canada. White anticipates strong demand for the revamped 2019 program.
“I think it will attract farmers who are new to the program where maybe the $400,000 limit wasn’t enough for them,” he said.
“The interest-free component will certainly attract more farmers.”
The CCGA typically doles out about 10,000 advances worth around $1.45 billion. White believes they will top those numbers in 2019. The record was the year of the rail transportation crisis in 2013 when $1.6 billion went out the door.
Money for the program comes from commercial banks and the CCGA has made provisions with its lenders to increase its credit limits in anticipation of a strong 2019 program.
“We’re ready to accommodate whatever comes our way,” he said.
Growers will be able to apply for advances starting June 10 and cheques will be issued starting June 26.
White encourages first-time customers to apply over the phone, which takes about 15 or 20 minutes. Experienced customers can log in to their secure online account.
The CCGA has been issuing advances for the 2019 program since April 1. The new limits take effect May 29.
The association will be automatically reassessing all existing advances to ensure they maximize the new interest-free benefit for the canola portion of the advance as of May 29.
Farmers with existing advances who want to apply for additional funds will have to complete a new application but they will not be charged an additional administration fee.