Question Period Note: ADVANCE PAYMENTS PROGRAM INCREASES TO INTEREST-FREE LIMITS TO SUPPORT PRODUCERS

Q1 – How many producers have benefited from the increased interest-free limit?
Q2 – Why has the interest-free limit not been permanently increased?

R1 - For the 2025 program year, of the over 23,000 producers who received advances, over 14,000 producers benefited from the increased interest-free limit above $100,000. Of these producers, over 4,200 producers were able to maximize the interest-free benefit of $250,000 and over 1,000 producers were able to maximize the canola only interest-free benefit of $500,000.
R2 - While these increases have been temporary, federal program officials will continue to monitor the sector and to ensure the APP is meeting the business needs of producers.

The Advance Payments Program (APP) is a federal loan guarantee program that provides Canadian farmers with marketing flexibility in the form of low-interest cash advances so they can meet immediate financial obligations until they are able to sell their products.

APP cash advances are calculated based on up to 50% of the anticipated market value of the eligible agricultural products that a producer will produce or has in storage, up to $1,000,000 in total. The Government of Canada pays the interest on a portion of each advance.

The Agricultural Marketing Programs Act (AMPA) governs the APP. The standard interest-free limit of $100,000 is stipulated in both the Act and the Regulations.

The Government temporarily increased the $100,000 interest-free limit on advances under the APP across multiple program years, representing a total savings of $226.9 million for producers over the four-year period (2022 to 2025).

Interest-Free Limit Amounts:
• $250,000 in 2022
• $350,000 in 2023
• $250,000 in 2024, 2025, and 2026
• $500,000 for canola in 2025 and 2026

Announcements:
• On March 7, 2025, it was announced that the interest-free limit was being temporarily increased to $250,000 for the 2025 program year. Participating producers could save on average $5,000 in interest costs. This change will represent estimated savings of up to $52 million for approximately 13,300 producers.

• On September 5, 2025, it was announced that the interest-free limit will be temporarily set at $500,000 for canola advances in the 2025 and 2026 program years. It is expected that this program change would provide approximately 1,745 canola producers in program year 2025 and 6,000 canola producers in program year 2026 with a combined $36.3 million ($5.1 million in 2025 and $31.2 million in 2026) in additional interest savings for the 2025 and 2026 program years.

• On April 1, 2026, it was announced that the interest-free limit was temporarily increased to $250,000 for non-canola advances for the 2026 program year. Participating producers could save on average $4,340 in interest costs. This change will represent estimated savings of up to $37.4 million for approximately 8,618 producers.

Total Advances Provided:
• 2022 Program Year: APP provided $3.5 billion in total advances to 18,940 producers. A total of 9,634 producers were able to benefit from the increase, and of these, 5,122 were able to maximize the $250,000 interest-free benefit.

• 2023 Program Year: A total of 21,467 producers (value of $4.5 billion) received advances. A total of 7,504 producers received interest-free advances above $250,000, and of these, 4,950 received the maximum interest-free benefit of $350,000.

• 2024 Program Year: A total of 22,331 producers (value of $4.2 billion) received advances. A total of 13,286 producers received interest-free advances above $100,000, and of these, 6,969 have been able to maximize the $250,000 interest-free benefit.

• 2025 Program Year: A total of 23,014 producers (value of $4.8 billion) have received advances. A total of 14,031 producers have received interest-free advances above $100,000.

• Producers have access to the Advance Payments Program (APP), a federal loan guarantee program which provides easy access to low-interest cash advances, helping producers meet their financial needs.
• In light of high input costs and increased interest rates, the Government of Canada increased the interest-free portion of the APP advances in the 2022, 2023, 2024, and 2025 program years.
• To support producers navigating significant pressure and uncertainty, it was announced on September 5, 2025, that the Government of Canada was temporarily increasing the interest-free portion for canola advances to $500,000 for the 2025 and 2026 program years.
• Additionally, it was announced on April 1, 2026 that the Government of Canada was temporarily increasing the interest-free portion for all non-canola advances from $100,000 to $250,000 for the 2026 program year.