Advance Payments Program

 

The Federal Government guaranteed ‘Advance Payments Program’ (APP) advances up to 50% of the market value of your product during production, to be repaid as the product is sold.  The Newfoundland and Labrador Federation of Agriculture (NLFA) administers the program in Newfoundland and Labrador. 

 

Eligible products: Cattle, Hogs, Sheep, Fox Pelt, Mink Pelt, Fruits, Vegetables.

 

The first $100,000.00 advanced is interest free and an additional $300,000.00 is available at an interest rate of prime minus ¼%. 

 

Program requirements:

 

  • A producer MUST be enrolled in AgriStability or Production Insurance.  These BRM programs provide security for the APP advance.  Production Insurance is only available for crop production.

  • As a corporation or partnership the majority of interest held in the company must be by Canadian citizens or permanent Canadian residents.  One individual must be of the age of majority, be principally occupied in farming, own the agricultural product, and be responsible for its marketing.

  • As an individual producer you must be either a Canadian citizen or permanent Canadian resident, be of the age of majority, be principally occupied in farming, own the agricultural product and be responsible for its marketing.

 

How to determine your eligible advance amount?

  • Production calculations are done by multiplying the quantity of units you produce by the advance rate approved for the current APP year.  Please refer to the forms below for your particular commodity’s current rate.

  • Advances are eligible for up to 100% of your  AgriStability reference margin, or 60% of your Production Insurance insured value, on your first installment.  Second installments can be issued to “top up” your advance to your production calculations.

  • The eligible amount to be advanced will be either your production calculation or your limitation from AgriStability/Production Insurance, whichever is less.

  • $400,000.00 is the maximum advance allowed for any corporation, shareholder or individual.

 

How is your advance paid back?

  • For most commodities, repayments are due as you market your product.  Payment is due within 30 calendar days of receipt of payment or 60 calendar days from delivery to buyer, whichever is earlier. You have 30 calendar days from your date of payment to submit proof of sale but no later than the end of the production period.

  • For continuous flow advances, including all hog/weaner advances, repayments are generally due 12 months from the date of advance.  You have 30 calendar days from your date of payment to submit proof of sale but no later than September 30, 2016.

  • Late payments, or payments without proof of sale, are permitted until the end of the production period (refer to your commodity’s forms for dates) but penalties will be applied.

  • Please call if you have any concerns about late payments or lack of proof of sale so we can let you know all of your options.\

  • Any advance amount exceeding the interest free portion of $100,000.00 will be charged an interest rate of prime minus ¼% compounded.  Interest will be collected with your final payment on or before the end of your production period.

  • As your repayments occur they are applied to the interest free loan portion first.

 

How can you apply for the Advance Payments Program?

Please contact Paul Connors at (709) 747-1759 or email paul[at]nlfa.ca.

 

 

 

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