The Government of Ontario is making improvements to the Commodity Loan Guarantee Program to extend repayment deadlines, increase lending capacity and provide farmers with greater flexibility to purchase essential crop growing supplies, such as seed and fertilizer.
“During consultations on the Commodity Loan Guarantee Program, we heard consistently that longer repayment periods and having overlapping loans would be helpful to farmers,” said Ernie Hardeman, Minister of Agriculture, Food and Rural Affairs. “Through these changes, we’re giving farmers assurance that they will not have to market their crops in less than ideal market conditions just to meet their loan obligations.”
The Commodity Loan Guarantee Program’s loan repayment deadlines are being permanently extended from February 28 to September 30 to better align repayment dates with the growing season. The extended deadlines will reduce paperwork and costs for farmers who would otherwise have to transfer their loans to other financing options until the sale of their crops. The program’s maximum guaranteed loan limit is also being permanently increased from $120 million to $200 million to allow extended loan repayment deadlines and accommodate an increase in lending capacity.
These changes are being made following consultations with the Agricultural Credit Corporation (ACC) leadership, program clients, and the ACC’s lender, as part of a mandated five-year review that was conducted in 2020.
“Grain farmers in Ontario take great risks to build their businesses on many uncertainties. The Commodity Loan Guarantee Program is an important part of the risk management programming available to grain farmers,” said Brendan Byrne, Chair of the Grain Farmers of Ontario. “The government’s announcement that the fund for the loans will be increased and the payment timelines will be extended permanently are a welcome change to the program.”
“As administrator for the Commodity Loan Guarantee Program, Agriculture Credit Corporation is very pleased with the changes announced by Minister Hardeman today, said Jaye Atkins, CEO. “This will expand the producer’s marketing window to ensure the best possible prices are obtained while assisting with producer cashflow requirements.”
Changes to the Commodity Loan Guarantee Program are now in effect, and clients of the Agricultural Credit Corporation will be notified that their loans are extended.