Brendan Smith (Cavan-Monaghan, Fianna Fail)
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1412. To ask the Minister for Agriculture, Food and the Marine his plans to introduce long-term low-cost loan measures to assist agribusinesses improve competitiveness due to the particular challenges that will arise from Brexit; and if he will make a statement on the matter. [38918/17]

Michael Creed (Cork North West, Fine Gael)
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The Agriculture Cashflow Support Loan Scheme was developed by my Department in co-operation with the Strategic Banking Corporation of Ireland (SBCI), and made €150 million available to farmers throughout Ireland at low-cost interest rates of 2.95%. It provided farmers with a low-cost, flexible source of working capital, allowing them to pay down more expensive forms of short-term debt, ensuring the ongoing financial sustainability of viable farming enterprises. The Scheme was launched on 31 January 2017 and by the beginning of March, all of the participating banks had reported that their funds were committed.

The SBCI have reported that, to the end of June 2017, there have been 3,672 loan drawdowns amounting to a total of €117.3 million (or 78% of the total). This is an average loan amount of  almost €32,000. Some 59% of the loans are for terms of 4 years or more. The participating banks have advised that all of the remaining €150m is in the process of being drawn down.

One of my priorities has been to address the impact of the change in the sterling exchange rate and lower commodity prices in some agriculture sectors. I was pleased at the very positive reaction by farmers to the Scheme, which has proved that significant demand exists for low-cost flexible finance. I have since met with the Chief Executives of the participating banks to discuss this and other access to finance issues relating to the agri-food sector. I have asked the banks to respond positively to the demand that has been demonstrated by reducing interest rates and providing more flexible terms for cash flow loans in the future.

I believe that this scheme demonstrates the importance of lower cost and more flexible finance as a response to competitive pressures, and I hope that it will be a model for possible future measures.