Young Victorian farmers may soon be able to borrow a cow from a more established dairy farmer in an effort to assist them to get into the industry. United Dairy farmers of Victoria (UDV) said it was planning to set up a 'cow loan' scheme which would help new farmers get started.
Damian Murphy, a dairy farmer from Gippsland and policy councillor with UDV, said buying a farm and cows could be incredibly difficult for people who did not inherit a farm from family.It's easy enough to be in the industry up to a point," he said. "You can be an employee and work your way up to management, but the problem comes when they want to take that step from being a manager to running their own share farm.
"When they need to purchase dairy specific assets, that's when it becomes difficult; it's very expensive."
Cows as collateral sweeten loan applications;Mr Murphy said the scheme would work by allowing older, more established farmers to offer a cow as collateral for a younger farmer's loan application.
This is how it works; a farmer offer up a cow and it would actually stay on his farm, and get milked and everything like that, but it would able to used as guarantee on part of a loan.
The only reason it would leave the farm or be sold to be cashed would be if the young farmer defaulted on their loan.
The younger farmer would be able to use the value of the cow as an asset to approach a bank with the backing of a number of older farmers providing collateral.
No comments:
Post a Comment