Friday, March 29, 2024

Loan repayments start in October

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Fonterra’s 15c increase in forecast payout for 2016-17 will go to repaying the support loan of 2014-15 for more than 70% of its supply farmers.
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Based on the forecast, farmers who took the loan would have 15c deducted from their October payment, the final for this season.

That would recover about half of the $363 million still owed to Fonterra and interest of 2.47% would be charged on the balance.

If the $6.50 forecast for next season was maintained or bettered and the current payment schedule still applied, the final loan repayment would come out in September 2018, chairman John Wilson said.

“We are doing what we always said we would do – start taking back that loan money automatically when the payout rose above $6.”

For those farmers with a support loan, October’s retro payment would be a net 14c and for the others 29c.

The co-operative had returned to an historical guideline of 65% advance rate to start next season, being $4.21/kg of the $6.50.

 

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