Demand for agri-lending from the credit union-administered Cultivate finance package has taken a sizeable jump this year.

The value of Cultivate loans issued during January and February was up around 10% on 2021, according to Brendan Heneghan of Cultivate.

However, the level of agri-lending from credit unions has doubled in strong dairy areas, as many milk suppliers were forced to pay up-front for fertiliser purchases.

St Patrick’s Day is traditionally a call to action for drystock farmers, but February was a lot busier this year due to the problems farmers had sourcing fertiliser

“March and April are usually the key months for us in terms of loans,” Heneghan explained.

“St Patrick’s Day is traditionally a call to action for drystock farmers, but February was a lot busier this year due to the problems farmers had sourcing fertiliser,” he added.

An initiative to share the cost of financing fertiliser purchases between credit unions and merchants has also driven demand for Cultivate loans.

Heneghan said the link-up was proving extremely popular with both farmers and merchants, as the loan facility provided working capital for farmers, while also reducing merchants’ exposure to fertiliser-related debt.

Tom McWey of St Canice’s Credit Union in Kilkenny said agri-lending was running at double last year’s levels this spring.

“We were far busier in January and February than expected,” said McWey, who is the business development officer with the Kilkenny-based credit union.

An interesting development this spring has been the number of dairy farmers who have taken out loans through Cultivate, McWey said.

“I suppose we have broken the mould in some ways, but we have a lot more dairy farmers taking Cultivate loans,” the St Canice’s official maintained.

McWey said the average Cultivate loan with St Canice’s was €30,000

Much of this additional business was linked to the increased difficulties farmers have experienced in purchasing fertiliser stocks so far this year, McWey conceded.

Securing finance from the credit union gave farmers “buying power” and the “facility to do cash deals,” he explained.

McWey said the average Cultivate loan with St Canice’s was €30,000.

Total lending nationally under Cultivate is in excess of €60m, Heneghan confirmed.