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- Recovery loan programs available to farmers, ag businesses
News Release Distributed 07/20/09
BATON ROUGE, La. – Three loan and grant programs are assisting farmers and agribusinesses affected by hurricanes Gustav and Ike and aquaculture producers facing high feed costs.
The first of these programs offers low-interest loans with a grant component to producers who suffered at least $10,000 worth of damages from the 2008 hurricanes.
According to LSU AgCenter economist Dr. Kurt Guidry, damages can be associated with revenue reductions because of yield or quality losses, as well as production and marketing cost increases and infrastructure damage.
“Increased cost of production has to be directly attributable to the hurricanes,” Guidry said. “Increase in fuel costs following the hurricanes is not eligible.”
Producers can get five-year loans at 1.5 percent interest, and if they pay off the loan on time, the fifth year would be considered a grant they would not have to pay back.
The Louisiana Department of Agriculture and Forestry is administering the loans, and growers will face limitations on how they can use the money.
“The money must be used for the 2009 cost of production or on carryover cost of production from 2008,” Guidry explained. “Growers cannot use the money to pay of fixed loans.”
Growers can get up to $100,000 through this loan program.
The second program is simply a low-interest loan available to agribusinesses that suffered losses because of the hurricanes.
“Agribusinesses must have damages of at least $10,000 and have a 20 percent decline in gross revenue in 2008 as compared to 2006 and 2007,” Guidry said.
Eligible businesses can receive up to $250,000 and have more flexibility in how they can use the money.
“This money can be used to refinance high-interest debt,” the economist said.
Both programs are accepting applications now through August 21, 2009. Producers interested in participating must complete an application and submit it to a Louisiana agriculture department regional office.
A third program provides a grant for aquaculture producers to help offset the high cost of feed in 2008, Guidry said.
The money for this program comes from the American Recovery and Reinvestment Act of 2009, and, according to Guidry, 40 states applied for and received money.
“Louisiana was the fourth-largest recipient,” Guidry said. “We got around $2.5 million.”
Farmers producing baitfish, catfish, crawfish, tilapia and turtles may be eligible, but they must show that in 2008 their feed cost was 25 percent higher than their average feed costs over the previous five years, he said.
Producers can receive up to $100,000.
Aquaculture producers hoping to take advantage of this program must apply by August 13, 2009. Applications are due to the Louisiana Department of Agriculture and Forestry.