OTTAWA — In what turned out to be one of his last official duties as federal agriculture minister, Lawrence MacAulay announced a new loan program to help young farmers get started.
The starter loans of $50,000 are designed to help those aged 18 to 25 buy a piece of equipment or invest in an agricultural business, he told the Canadian Federation of Agriculture annual meeting.
“We need smart and young producers,” he said, and this program is one way to gain them.
Young farmers today have to be educated and innovative, he said.
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“They also need capital,” he said.
In an interview, the minister said the loan amount is small but it’s designed to be an entry point. Tied in with other financing programs, it’s a bid to attract more young producers to the sector.
“I fully understand that’s only a portion of the cost to try to get started,” he said. “But we’re working as hard as we can to make sure that we have more young people involved.”
He told the meeting that there are now more young farmers under aged 35 than there were 25 years ago.
Marty Seymour, FCC’s director of industry and stakeholder relations, said FCC ran a pilot program to test uptake and found that for the intended demographic, the loan amount works.
“It’s the perfect amount, creates some financial literacy for people (and) gives them a chance to start their business in a reasonably modest risk standpoint,” he said.
The money could be used to invest in cattle, for example, and allow young people to decide if that sector is right for them. Or, a young entrepreneur could buy an existing business or start a new one.
The loans are available at preferential rates, with no fees.
Seymour said FCC has other products to take producers beyond this initial step.
“This isn’t about us building a farm enterprise,” he said. “If they can make a career out of it we’ll be behind them the whole way.”
Outgoing CFA president Ron Bonnett said the loan program is timely.
“It’s going to be young people that drive agriculture to the next level in Canada,” he said.
