Drought affected farmers have been assigned A$100 million in a new drought recovery loan scheme for those hit by severe dry weather and Indonesian cattle export disruptions.

Minister for Agriculture, Barnaby Joyce, said the loans would target farm businesses in need of financial help after a “severe and protracted drought”.

Worst hit are large parts of Queensland and some areas of New South Wales, reeling from the worst dry conditions on record.

Additionally, funds extend to helping those affected by the mid-2011 live export block on cattle to Indonesia, as well as support through a lack of rain.

Farms can apply for up to $1 million over ten years, adding to existing Farm Finance and Drought Concessional Loans schemes.

Loans worth over A$150 million to 286 farm businesses in Queensland and New South Wales have already been approved under the two earlier packages.

Queensland based farm association, AgForce, welcomed the announcement, calculating that funding would would benefit 79 per cent of the state.

AgForce commended Mr Joyce on the ten year payment schedules with a 3.21 per cent interest rate.

Earlier, farm groups queried the borrowing rate on loans and said terms were too short.

Discussing loan repayments, AgForce said: “Importantly, the Minister has agreed that the loans will be made available for loans up to 10 years at a variable concessional interest rate initially set at 3.21 per cent.

“The current concessional loan scheme requires recipients to refinance after five years, which was not enough time to recover from historically dry conditions.

Minister Barnaby Joyce said that, given current “unprecedented” demand for Australian farm produce, supporting a return to full farm production when rains return is “vitally important.”

“These loans will help make that happen,” he said.

“They will fund planting and restocking activities that help farm businesses crippled by the effects of drought return to normal operations.

“Large parts of Queensland and some parts of New South Wales are experiencing the worst dry conditions on record, with rainfall at historical lows in many areas,” Minister Joyce said.

“The government has listened to farmers and what they’ve told us is that they need access to finance at a lower rate and for a longer term to rebuild their businesses from these dry conditions.”

Source - http://www.blackseagrain.net/