Agriculture Loan and Loan Guarantees
NB, Canada
Financing to buy or develop New Brunswick farmland
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|noCondition
grant_single|deadlines
- grant_single|timelineUnspecified
grant_single|financingType
Loans and Capital investments
grant_single|eligibleIndustries
- Agriculture, forestry, fishing and hunting
grant_single|grantors
- Government of New Brunswick
- Aquaculture and Fisheries (NB)
- Department of Agriculture
grant_single|status
grant_card_status|open
grant_single_labels|preview
Get a loan or loan guarantee to start a new farm or purchase an existing one, to purchase shares in a farming operation, or to buy or develop land for farming.
grant_single_labels|projects
This program supports agricultural development by filling financing gaps for viable projects within the sector. Eligible activities aim to enhance agricultural operations through strategic investments.
- Purchase an existing farm.
- Start a new farm.
- Purchase shares in a farming operation.
- Purchase land for farming.
- Develop land for farming.
- Working capital requirements.
grant_single|admissibleProjectsExample
$350,000
Purchase and expand an existing dairy farm, including new facilities and equipment
$320,000
Acquire and convert a conventional farm into an organic certified farm
$200,000
Establish a new organic vegetable farm including land acquisition and necessary equipment purchase
$140,000
Launch a local bee farming project focusing on honey production and research
$120,000
Create a hydroponic urban farm infrastructure with advanced systems
$170,000
Develop an agroforestry project incorporating sustainable practices and equipment investment
grant_single_labels|admissibility
Eligibility for this loan and loan guarantee program is determined by specific requirements related to the applicant's financial condition and proposed activities within the agriculture sector.
- The applicant must first seek financing from a private lender before applying for a DAAF loan or loan guarantee.
- Eligible activities for the loan or loan guarantee include purchasing an existing farm, starting a new farm, purchasing shares in a farming operation, purchasing land for farming, developing land for farming, and addressing working capital requirements.
- Refinancing or repaying existing debt is not considered an eligible activity.
- Applicants must submit a comprehensive business plan, including a project description, financial information, management plan, marketing plan, and production details.
- Acceptable security must be provided for the loan or loan guarantee.
- Applicants must demonstrate a minimum equity into the project of 10%, or 5% for new entrants (those who have owned a farm for five years or less).
grant_eligibility_criteria|who_can_apply
In Canada, individuals or entities who can apply for the Agriculture Loan and Loan Guarantees program through the Department of Agriculture, Aquaculture and Fisheries (DAAF) include:- New entrants to farming (those who have owned a farm for five years or less) - Established farmers looking to purchase an existing farm, start a new farm, purchase shares in a farming operation, buy land for farming, develop land for farming, or need working capital.Applicants must seek initial financing from private lenders, after which they may apply for DAAF's program to meet any financing gaps. They must also meet certain equity and security requirements, and submit a comprehensive business plan.
grant_eligibility_criteria|who_cannot_apply
There are some types of companies that are not eligible for this grant:
- Non-profit organizations
- Individuals
grant_eligibility_criteria|eligible_expenses
The eligible expenses for the Agriculture Loan and Loan Guarantees program focus on costs associated with acquiring and developing farming operations.
- Purchase an existing farm.
- Start a new farm.
- Purchase shares in a farming operation.
- Purchase land for farming.
- Develop land for farming.
- Working capital requirements.
grant_eligibility_criteria|zone
The grant covers specific expenses directly related to enhancing service delivery and ensuring project success.
- Salaries and wages for staff dedicated to the project.
- Consulting fees for professional or technical services.
- Equipment purchases necessary for service improvements.
- Cost of materials and supplies directly used in the project.
- Costs associated with training and development for the project team.
grant_single_labels|criteria
There are evaluation and selection criteria for this grant. The evaluation and selection criteria include:
- Economic impact of the project
- Innovation and originality of the project
- Feasibility and risk assessment
- Capacity and experience of the project team
- Alignment with grant objectives and priorities
grant_single_labels|register
- Step 1: Seek Private Lending
- Contact a private lender to apply for initial financing.
- Obtain a formal decision letter outlining the financing they will provide and any shortfall.
- Step 2: Prepare Business Plan
- Develop a detailed business plan including description of your business, financial projections, marketing, and management plans.
- Ensure the business plan includes a minimum of three years of projected income statements and cash flow statements, and for existing operations, previous three years financial statements or tax returns.
- Include production details with a three-year historical and projected summary.
- Step 3: Complete DAAF Application
- Fill out the application form provided by the Department of Agriculture, Aquaculture and Fisheries.
- Attach the detailed business plan along with other necessary documents.
- Ensure acceptable security arrangements are included.
- Step 4: Demonstrate Equity Contribution
- Provide evidence of minimum 10% equity contribution, or 5% for new entrants, into the project.
- Discuss with DAAF if a higher equity level is necessary due to risk factors involved.
- Step 5: Submit Application
- Submit the completed application form and all supporting documents to the Department of Agriculture, Aquaculture and Fisheries.
- Double-check the submission for completion and accuracy.
- Step 6: Confirmation and Follow-up
- Receive confirmation from DAAF regarding the receipt of your application.
- Be prepared to discuss your application further with DAAF representatives if needed.
grant_single_labels|otherInfo
Here are additional relevant details for this grant:
- Interest rates for loans are determined on a case-by-case basis, allowing for potentially lower rates depending on the project's risk assessment.
- Repayment terms are flexible and matched to the cash flow projections in the business plan, which can include interest-only payments or both principal and interest payments.
- Younger farmers or new entrants may have advantages with lower interest rates and equity requirements, potentially making it easier for them to secure funding.
- No application fee is required, which reduces the initial financial burden on applicants.
- A loan guarantee fee of 1.5% is payable annually, which is a consideration for financial planning and budgeting of applicants.
Apply to this program
Agriculture Loan and Loan Guarantees by DAAF
The Department of Agriculture, Aquaculture and Fisheries (DAAF) offers repayable loans and loan guarantees to support the growth and development of the agriculture sector. It acts as a complementary lender to bridge funding gaps after private lending resources have been exhausted.
Understanding the DAAF Agriculture Loan and Loan Guarantees
The Agriculture Loan and Loan Guarantees program provided by the Department of Agriculture, Aquaculture and Fisheries (DAAF) is a pivotal support initiative aimed at enhancing the agriculture sector's capacity and sustainability. Acting as a complementary financial aid program, this initiative is specifically designed to assist clients who have already sought financing through private lenders. By stepping in to cover the additional financial needs that go beyond private sector approvals, DAAF fulfills a crucial role in ensuring the viability and success of various agricultural projects.
The program particularly targets various eligible activities essential for nurturing and sustaining farm operations. These include purchasing an existing farm or shares in a farming operation, initiating a new farm, securing land for agriculture, and developing land for sustained farming activities. It also extends to providing necessary working capital for ongoing operations, although refinancing or repaying existing debt remains ineligible under this scheme.
Designed with an inclusive approach, the program is not only for seasoned farmers but also serves as a valuable opportunity for new entrants, defined as those who have owned a farm a relatively short period of five years or less. These novice farmers can particularly benefit from potentially reduced interest rates and equity requirements, making it easier for them to invest in and grow their agricultural pursuits.
A cornerstone of the application for this program is a comprehensive business plan. Interested applicants must prepare a detailed proposal including a description of the business and the intended project, financial projections covering income and cash flow for at least the next three years, as well as records from the previous three years if they belong to an existing operation. Further, the business plan must include management plans detailing how the business will be operated along with management's qualifications, a marketing strategy outlining target sales strategies, and production outlines that provide historical and forecasted summaries of agricultural output.
In terms of financial obligations, acceptable security is mandated for the loan or guarantee, with a minimum equity investment of 10% required from the applicant, although this is reduced to 5% for new entrants. Note, however, that the actual equity requirement might be adjusted based on the perceived risk associated with the project, underscoring the need for high-quality, viable proposals.
No application fee enhances the accessibility of this robust funding initiative, and interest rates are thoughtfully calibrated on a case-by-case basis, often tied to project cash flow as justified by the applicant’s business plan. Flexible repayment terms are afforded, with options including solely interest payments or a combination of principal and interest, tailored to align with the project's financial projections.
Finally, there is a nominal loan guarantee fee, set at 1.5% of the guaranteed amount. This fee is paid upfront at the start of each year the guarantee is active, ensuring that the program remains both sustainable and supportive for agricultural projects needing financial facilitation.
