In his Budget 2017 speech before the Dail this Tuesday, Minister Noonan said that the EU's exceptional adjustment aid will be drawn down by the Department of Agriculture to provide a low-cost loan system for farmers "with rates below 3% per annum".

"These loans will enable farmers to improve the management of their cash flow and reduce the cost of their short-term borrowings," he said.

This means that the Irish Government will choose measures to make cheaper credit available to farmers when it applies for the €11.1m available to Ireland as part of the €350m aid package announced by the European Commission last July.

€150m loan fund

A total loan fund of €150 million has been put in place to support highly flexible loans for up to six years, for amounts up to €150,000. The loans will be at an interest rate of 2.95% and available through banks to livestock, tillage and horticulture farmers. The low interest agri-cash flow fund will be developed by the Department in partnership with the Strategic Banking Corporation of Ireland (SBCI). The fund includes the €11m made available under the EU’s exceptional adjustment aid for milk and other livestock farmers, matched by additional funding from the Irish Exchequer.

“I will be speaking to the CEOs of the main banks to urge them to provide this loan product," said Minister for Agriculture Michael Creed. " While I hope that the loans will be available early in the New Year, I would encourage farmers to consider their cash flow and borrowings situation now, and if appropriate, to be prepared to apply for these loans when they become available on a first-come, first-served basis. Loans need to be allocated by next summer to comply with EU reporting requirements.”

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