Cannabis growers, some of which are not seeing the revenue expected prior to legalization, may be in line for up to $500,000 in short-term loans under the $5 billion Farm Credit Canada (FCC) stimulus linked to the COVID-19 pandemic.
The funding is meant to provide financial flexibility to farmers, according to Marie-Claude Bibeau, minister of Agriculture and Agri-Food Canada, who announced the program March 23.
“Their continued work is essential to our plan to manage COVID-19,” Bibeau said.
Trevor Sutter, chief communicator with Farm Credit Canada, sent some details to Western Investor after we reported on the stimulus package.
“Farm Credit Canada (FCC) is working with customers to offer loan payment deferrals and short-term credit products up to a maximum of $500,000 to assist with cash flow needs,” Suttor explained.
“Businesses applying for FCC lending products will be subject to normal lending due diligence, which considers business viability, credit history, and management integrity and experience. In order to be eligible, businesses needed to be financially viable entities prior to the impact of COVID-19.”
Suttor’s office confirmed that federally-regulated cannabis producers are considered farmers under the stimulus.
Despite a reported increase in cannabis sales since the onset of COVID-19, the cannabis industry has been retracting this year.
One of the largest cannabis growers in the world, Canopy Growth Corp. closed two B.C. greenhouses this year while scuttling plans to open a growing facility in Ontario’s Niagara region.
Aurora Cannabis, meanwhile, scaled back a planned 800,000-square-foot grow operation next to the Edmonton airport and reduced the size of smaller operations in rural Alberta.