Farmers thankful for Ottawa's loan extension

A decision to extend the time allowed for cattle and hog farmers to repay cash advances from the federal government will provide some relief, says the P.E.I. Federation of Agriculture.

Last Friday, federal Agriculture Minister Gerry Ritz announced that cattle and hog producers facing hard financial times will now have until Sept. 30, 2010, to repay money provided through the Advance Payment Program during the 2008-2009 production period.

The program is designed to provide farmers with some cash flow before they sell livestock.

In addition, the first $100,000 of each producer's advance will continue to be interest-free.

Mike Nabuurs, executive director of the P.E.I. Federation of Agriculture, told CBC News on Monday that farmers across the country lobbied for the change.

He called the extension a step in the right direction but said a long-term strategy is still needed.

"This is something we've been pushing for," said Nabuurs.

"This deferral is a good start and over the next year and half or so we'll work at an alternative plan. We'd like to maybe see this be spread out maybe over a long period of time, in terms of the repayment, until we can get the livestock sector back to profitability."

Nabuurs said a long-term plan is being worked on now for the Atlantic region.

The issue will likely come up at the federation's annual meeting slated for Friday in New London.