|May 31, 2016
Ontario to Double Cap for Loan Guarantees
The provincial government is helping to ensure a thriving cattle industry and retaining Ontario jobs, by improving access to guaranteed loans for cattle farmers and increasing their buying power.
The Ontario Ministry of Agriculture Food and Rural Affairs has worked with industry stakeholders to review the Feeder Cattle Loan Guarantee Program (FCLGP), resulting in significant improvements to address changing markets and simplify program access for farmers. This, along with improvements made last year to double individual lending limits, will allow more farmers access to competitive interest rates, and give new farmers a better start.
The FCLGP was established in 1990 to help farmers access low interest loans, to expand their business and remain competitive.
Improvements to this program include:
- Doubling total available Ontario-guaranteed loans from $130 million to $260 million
- Enhancing program administration to simplify access
- A new option for custom feeding that will assist new farmers in growing their herd
- Flexibility for more farmers to participate in accordance with their current business practices.
Farmers can take advantage of the increased loan cap immediately, with other improvements in place by fall 2016.
Supporting Ontario’s Beef industry is part of the government’s plan to build Ontario up and deliver on its number-one priority to grow the economy and create jobs. The four-part plan includes investing in people’s talents and skills, making the largest investment in public infrastructure in the province’s history, creating a dynamic, supportive environment where business thrives and building a secure retirement savings plan.
- Since 1990, the government of Ontario’s loan guarantee has aided approximately $1.53 billion in direct economic activity within the beef cattle industry and saved farmers about $27 million in bank interest costs.
- Ontario beef represents farm gate sales revenue of almost $1.4 billion, processing revenue of $3.5 billion, and retail sales of $9 billion annually.
- Ontario’s beef industry is responsible for 9,500 jobs in primary production, 9,000 in processing, and almost 43,900 in retail.
- There has never been a claim against the government guarantee in the 25-year history of the FCLGP.
“By doubling the cap for loan guarantees, combined with the increased lending limits we put in place last year, our government is continually committed to working with Ontario’s beef industry. These improvements mean greater access to a successful program that is providing vital support for our growing beef industry, especially for new farmers looking to take the next step in building and expanding their business and herds. The purchasing power provided through the loan guarantee program will help to close market gaps, while ensuring Ontario beef farmers are competitive both domestically and in our rapidly growing export markets.”
— Jeff Leal, Ontario Minister of Agriculture, Food and Rural Affairs
“The co-ops administering the loans are happy with these improvements, as are our members. This program helps keep Ontario’s beef farmers competitive in a growing and changing marketplace. The demand for our beef is high, and this will mean greater opportunity to grow our supply and provide quality Ontario beef to our markets.”
— Matt Bowman, President, Beef Farmers of Ontario