CDN Canola Growers Association

[Jim]

Wanted farmers feedback if they have received CCGA financing from this organization. Have used FCC and AfSC previously. But the advertised 100k at 0% looks far more attractive and financially better decision.

Anything to watch out for or bad experiences. Unfortunately grain prices are looking like another bad year so need to save as much as possible on input costs.

[yoteblaster]

Are you talking about the cash advance program? I have used it for close to 20 years. $50 administration fee and you’re good to go. Need to pay off last years advance before you can start a new one. Basically one year just rolls into the next one.

[IL Bar]

It’s a bit of a different tool for cash flow than borrowing money from AFSC or FCC for inputs. Yes it’s 0% interest but any grain you deliver to the elevator automatically goes to pay off the advance. I like revolving loans but with interest rates up have to watch how you use those as well.

I tried it once and it wasn’t really for me. It didn’t help that years ago my father advised me to stay away from advances if I could. Maybe that advice has helped me or hindered me all these years.

[Drewski Canuck]

Is the advance tied to a Futures contract? Is there a discount on price when delivering grain for sale?

Just curious. They have to be making money somehow. Or is the amounts over $100 K at a higher interest rate?

Drewski

[esher]

Advance isn't tied to anything. When you deliver grain some companies take the refund off some don't. The money is federal canola growers only administer it.

[dfarms11]

Advances are not tied to a contract although must be secured either with crop insurance coverage or actual grain in the bin. They also don't cover full price for grain, but about only roughly 50-60% of what it's worth. Pretty much limits risk of a substantial drop in crop prices. Up to $100000 is interest free, anything over that is prime less 0.25%. Still reasonable. Must pay a portion back everytime you sell grain. There are also deadlines and penalties if payments not made on time and such. Doesn't come without it's rules.

[Armorman]

It's a great program and you have nothing to be concerned with other than making sure you have enough cash or product to sell in order to clear off your loan by the deadline. I take a cash advance every year on stored grain but just the interest free portion. I see for the 24/25 crop year the interest free portion has been reduced to $100k. For the past few years that amount was a lot higher. Unfortunately $100K doesn't go very far today.

[DRhunter]

Have been using this the Advance Payment Program with our calf crop for 4-5 years now. There are many administrators for the program, but I have been using CCGA as the administrator for my advance as there was no fees (other administrators charge between $50-500 to use them for the program).

Great program to have interest free advances that are repaid as you sell your inventory (calves or grain). Even if I didn't need the cash, I would advance, put in a GIC for the expected period before resale and earn 4-5.5% interest on it. My opinion only, but you would be crazy not to take interest free money.

DR

[Jim]

Using advance to purchase GIC’s also crossed my mind as well. At 0% it’s a no lose situation.

[fishnguy]

Originally Posted by Jim

Using advance to purchase GIC’s also crossed my mind as well. At 0% it’s a no lose situation.

Except for the taxpayers.

[gman1978]

Originally Posted by fishnguy

Except for the taxpayers.

This is not subsidized by tax dollars

[Au revoir, Gopher]

Originally Posted by gman1978

This is not subsidized by tax dollars

You sure about that?

From CCGA's FAQ:

​​​The Advance Payments Program (APP) is a federal program, delivered and administered by Canadian Canola Growers Association. Under the program, the Government of Canada provides the loan guarantee, funds the interest-free portion of advances and helps to make low interest rates on the remainder for Canadian producers.

https://www.ccga.ca/cash-advance/Pag...s.aspx#k=#s=21

ARG

[gman1978]

Originally Posted by Au revoir, Gopher

You sure about that?

From CCGA's FAQ:

​​​The Advance Payments Program (APP) is a federal program, delivered and administered by Canadian Canola Growers Association. Under the program, the Government of Canada provides the loan guarantee, funds the interest-free portion of advances and helps to make low interest rates on the remainder for Canadian producers.

https://www.ccga.ca/cash-advance/Pag...s.aspx#k=#s=21

ARG

I thought It was viewed as “revenue neutral” and not a subsidy in the SCAP agreement but I could be wrong.

[Jim]

Don’t hate the player, hate the game.

Write to your MP and tell him you want to make life more difficult for farmers. Let me know his response.

[fishnguy]

In short, the interest is subsidized by the taxpayers. Still short, but a little longer version, the government of Canada borrows funds to cover the interest on these loans (and the money that is never repaid, of course - defaults, if you will) and these funds they borrow aren’t free either.

This is not knocking on anything or anyone, just context. The way things work.

[dfarms11]

Originally Posted by Jim

Don’t hate the player, hate the game.

Write to your MP and tell him you want to make life more difficult for farmers. Let me know his response.

Send it to a Liberal MP, I'm sure the response will be...

Hold My Beer!

[gman1978]

Originally Posted by dfarms11

Send it to a Liberal MP, I'm sure the response will be...

Hold My Beer!

Or better yet that Cooky NDP MP that wants to make promoting oil and gas hate speech. This would give him something to chew on.