Dairy Recovery Concessional Loans (SA)
This program aims to assist eligible dairy farm businesses in South Australia impacted by the 2015-16 reduction in milk prices.
It forms part of the Australian Government''s Farm Business Concessional Loans Scheme which replaces and builds on previous concessional loans schemes – the Farm Finance, Drought, Drought Recovery and Dairy Recovery Concessional Loans schemes. It also complements a range of other drought and risk management measures under the Agricultural Competitiveness White Paper to provide assistance to drought-affected farm businesses.
The key features of the scheme are:
- Loan amounts are for up to 50% of a farm business’s final debt position to a maximum of $1 million in total.
- A concessional variable interest rate commencing at 2.47% (as at 1 November 2016), which is reviewed on a six monthly basis.
- A maximum loan term of ten years, with interest only repayments for the first five years and principal and interest repayments for years six to ten.
- The farm business must repay or refinance the remaining loan balance at the end of the loan term.
The final debt position comprises eligible debt following any debt restructuring with a loan under the Farm Business Concessional Loans Scheme, non-eligible debt and the amount of the loan under the Farm Business Concessional Loans Scheme.
Who Can Apply
Eligible applicants must demonstrate that:
- Their farm business supplied milk to Murray Goulburn Co-operative Co. Ltd or its subsidiaries or related companies (Murray Goulburn) and/or Fonterra Co-operative Group Ltd or its subsidiaries or related companies (Fonterra) in 2015–16. Evidence that the farm business supplied milk to Murray Goulburn and/or Fonterra in 2015–16 may include:
a) A copy of a milk supply contract with Murray Goulburn and/or Fonterra.
b) A copy of a milk supply statement with Murray Goulburn and/or Fonterra.
c) Any other evidence PIRSA considers necessary.
- Their farm business has existing eligible debt and their farm business has not already borrowed up to 50% of its final debt position from the Commonwealth.
- They own and operate the farm business and their farm business:
a) Operates as a sole trader, trust, partnership or private company.
b) Is a dairy farm business.
c) Is wholly located in Australia.
d) Is registered for tax purposes in Australia with an Australian Business Number (ABN) and is registered for GST.
e) Is not a public company under the meaning of the Corporations Act 2001 (Cwlth).
- At least one member of the farm business must be a farmer who, under normal circumstances, contributes at least 75% of his or her labour and derives at least 50% of his or her income from the farm business.
- The majority of their farm business is conducted in South Australia.
- At least one member of the farm business is an Australian permanent resident.
- Their farm business is not under external administration or bankruptcy.
Eligible activities include:
- Debt restructuring
- Providing new debt for operating expenses
- Providing new debt for productivity enhancement activities
Please review the Guidelines for the complete information of eligible/ineligible activities.
Main Assessment Criteria
The main assessment criteria include how the applicants demonstrate that:
- Their application is for:
a) Debt restructuring
b) Providing new debt for operating expenses
c) Providing new debt for productivity enhancement activities
d) Any combination of a to c
- Their farm business has the capacity to repay the concessional loan and has sound prospects for commercial viability within the term of the concessional loan.
- They are able to provide satisfactory security acceptable to the Minister (acting through PIRSA).
61 days to go
30 June 2017
This program is open on an ongoing basis until 30 June 2017 or until funding is fully committed, whichever occurs first.
Infrastructure / Equipment
Primary Industries and Regions SA (PIRSA)