June 6, 2008

Canada's Manitoba doubles hog assistance loans


The maximum loan provided under the Manitoba government's recently announced Hog Assistance Loan Program has been doubled to CAN$5 million from CAN$2.5 million to assist hog producers who are facing cash flow challenges, the provincial government in a news release.

Manitoba's Agriculture, Food and Rural Initiatives Minister Rosann Wowchuk said the department is responding to the reality that larger hog operations need to maintain higher cash flows.

The deadline has also been extended to June 30, to give producers more time to access the funds.

The province has provided CAN$60 million in loan support to hog producers through the Manitoba Agricultural Services Corp this year.

The Manitoba Hog Assistance Loan Program allows producers to borrow up to CAN$35 per slaughter hog and CAN$10 per weanling sold between Oct. 1, 2007, and May 31, 2008. The loans have to be paid back over an eight-year period.

To date, more than 140 loans for more than CAN$38 million have been approved or are being processed, the release said. Principal payments on these loans can be deferred for the first three years.

The first-year interest rate is 2.25 percent on loan amounts of up to CAN$1.5 million with 4.5 percent charged on loan amounts from CAN$1.5 million up to CAN$2.5 million. The rate is 4.5 percent for all of these loans for years two and three, and 6 percent for the last five years. An additional interest rate reduction of 1 percent for the first three years is available for young farmers.

For loan amounts from CAN$2.5 million to CAN$5 million, the interest rate will be set at MASC's eight-year rate of 6 percent for the full term of the loan.

US$1=CAN$1.017