EXCLUSIVE Funding for the autumn harvest

• Farmers to receive 378.97 lei per hectare

• This aid can be complemented by loans granted based on the Law of farming loans

The Ministry of Agriculture will continue to provide financial aid to farmers this year for the autumn harvest, in spite of the troubles of the budget.

According to a memo of the Ministry of Agriculture, obtained by BURSA, the financial aid for the autumn harvest would amount to 378.97 lei/hectare.

Farmers may also take out loans based on the Law on Farming Loans, for which the state will provide a 30% grant.

• Provisions of the financial aid package

The financial package prepared by the Ministry of Agriculture first and foremost provides a subsidy of 39 lei/hectare for Diesel fuel used for farm works.

The state will subsidize Diesel fuel expenses with 39 liters/hectare, which will cost the state budget an estimated 120,900,000 lei, thus allowing the creation of 3.1 million hectares of crops.

Secondly, starting October 16, farmers may receive a 70% downpayment as part of the Unified Farming Area Payment Scheme (SAPS) for 2009, estimated at 209.07 lei/hectare (at an exchange rate of 4.2 lei/euro).

What"s more, farmers who benefit from SAPS, will also be able to take out loans (based on certificates issued by the Agency for Farming Intervention and Payments) of up to 31.18 Euros/hectare (which amounts to 70% of the value of the national complementary direct payment) by assigning the claims on the amounts to be received from APIA over to the banks.

50% of the loans will be guaranteed by the state, which will cost an estimated 130.97 lei/hectare.

The 70% downpayment for farming areas will cost an estimated 339.97 lei/hectare (209.07 lei/hectare under the SAPS scheme plus 130.97 lei for complementary payments).

Thirdly, the Ministry of Agriculture wants farmers that benefit from the warehousing certificate to take out loans of up to 50% of the value of the certificate.

Loans will be guaranteed 100%, and the warehouse certificates will be secured.

Besides the three aid measures that amount to 378.97 lei/hectare (339,97 lei as a downpayment plus 39 lei for Diesel oil), large farmers will be allowed to take out loans under the terms of the law 150/2003 (the Law on Farming Loans).

The state will provide a 30% grant for loans taken out by farmers.

For instance, for a loan of 600 lei/hectare - taken out as a complement to the state aid of 378.97 lei/hectare - upon repayment the state will subsidize 180 lei/hectare.

As it stands, the state aid amounts to 558.97 lei/hectare, which represents 55.9% of the expenses for the creation of the autumn crops, which cost an estimated 1,000 lei/hectare.

In order to fund the autumn harvest, the budget of the Ministry of Agriculture will be increased by 60 million lei, upon the next budget revision. An additional 650 million will be paid by the Treasury as a 70% downpayment for the payments per hectare for 2009.