A sugar cane replanting financing program was introduced today as welcomed to news to and industry that was almost brought to its knees with various setbacks this season. The Development Finance Corporation is making 3 million dollars available for loans to cane farmers for replanting sugar fields. Experts in the industry feel an initiative such as this is long overdue as yields have been consistently going down. BSI’s manager of Research and Cane Farmer Relations is Edwardo Zetina.
Edwardo Zetina – Manager, Research and Canefarmers Relation
“Replanting is extremely important to maintain productivity. If replanting is not done, physiologically the cane plant tends to decrease productivity and yield. Across the many years we have been in industry very little sustained replanting has taken place. As I mentioned canefarmers need to replant between 15 and 20% of their acreage every year, that is not happening, we are probably at about 4% of their acreage and doing just that 4% then the productivity of the fields are declining year and year until they reach to a point where it is no longer viable which is where we are now.”
The farmers themselves recognize the importance of improving yields and BSCFA’s Committee of Management Chairman, Alfredo Ortega says the more than 6 thousand active farmers have been long awaiting easy finance.
Alfredo Ortega, Chairman, BSCFA Committee of Management
“We are seeing for this crop that we are really down in our production for this crop that is ongoing. This program is somewhat late but at least it is the first step in this regard and I do believe that within the next two years we will be seeing an increase in production.”
Through this program, Famers will benefit from a low interest rate and a considerate repayment plan as DFC’s General Manager, Natalie Goff explains.
Natalie Goff – General Manager, DFC
“I think rates at other financial institutions are at 12, 13% so 9% is much lower, it is below the two digit figure. If the program is viable and if we have great demand, there could be economies of scale and we could even look at reducing it further but right now we don’t want to do that we want to go in, tread carefully and see how the program is administered, the viability of the program and we will revisit the interest rates from time to time. I would say that 9% financing is pretty affordable. You can’t only look at the rates, you have to look at the terms as was mentioned by Mr. Gongora, we are giving one year grace period and we are giving five years for the repayment of the loan so when you put that into consideration, even the rate may not be exactly what the farmers wants, 7% it is an affordable package.”
Sugar cane farmers who access these loans will also receive technical assistance from the Sugar Industry Research and Development Institute