Farm Business & Inputs Council Report September 2020

Activity since last National Council

• Separate teleconferences with AIB, BOI and Ulster Bank re. supports for farmers impacted by Covid:
  • IFA continues to update banks on current issues and future problems facing agri-sector due to Covid-19, weather, CAP post-2020, interest rates, loan payment breaks, commodity prices and Brexit.
• July Stimulus Plan
  • Funding for Future Growth Loan Scheme and Covid-19 Credit Guarantee Scheme
  • Employee Wage Subsidy Scheme & Pandemic Unemployment extended
  • Extra year of Income Averaging step-out allowed
  • €50m Beef Support Package
  • Additional allocation for on-farm renewable energy investments under TAMS – €10m
  • Investment in a large-scale habitat restoration project by Coillte – €7m
• Future Growth Loan Scheme (FGLS)
  • Scheme is now open for applications
  • Loan purpose: long-term and strategic investment to improve overall farm performance
  • €200m ring-fenced for agriculture
  • Interest rates: < €250k: Max 4.5%, >€250k: Max 3.5%
  • The SBCI determines eligibility of the loan purpose and the banks normal credit approval process applies
• Covid-19 Credit Guarantee Scheme (CCGS) – the details continue to be developed and change constantly. As of today’s date:
  • Expected launch date is early/mid September
  • Fund of €2bn backed by an 80% state guarantee
  • Aimed at businesses impacted by covid-19 to provide working capital/refinancing
  • Hurdle for eligibility: 15% drop in turnover, business must have been in a healthy financial position @ 01.01.20
  • Banks will determine eligibility
  • Loan amount: €10k-€1m, double a business’s wages bill or 25% of turnover.
  • Max Term: 6 years
  • Interest rates similar to or lower than FGLS
• Personal Insolvency Arrangements (PIA)
  • A recent circuit court judgement permitted farmland to be eligible for a PIA. This sets a new precedent meaning PIAs could be an option for some farmers in arrears. PIAs are a debt resolution mechanism which prevent the sale, surrender or repossession of the property. These arrangements restructure debt by reducing interest rates, extending the clearance period and writing off some liabilities; dependent on the circumstances.

Upcoming issues

• Budget 2021: Pre-budget doc submitted; Oireachtas Lobbying Event provisionally scheduled for September 16^th; lobbying should occur at a local level in the run-up to the Budget.
• Maintaining pressure on newly formed Government to ensure that the CCGS is made available as soon as possible; with unrestrictive eligibility criteria and facilitating working capital, investment and credit issues.
• Further meetings with banks to continue to get and provide feedback regarding ongoing finance issues.

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Inputs

Activity since last National Council

• President wrote a letter to all 27 EU commissioners seeking the removal and termination of the anti-dumping duty applied to imports of Ammonium Nitrate (AN) from Russia.
• IFA Brussels has contacted Commissioner Wojciechowski’s cabinet directly to clarify their position.

Upcoming issues

• The Commission will determine in the coming weeks whether the anti-dumping measure on AN imports from Russia to the EU are to be renewed.
• The supply of straw will be impacted by the poor harvest in parts of the country.

Chair	Rose Mary McDonagh
Executive	Donal Sheehan