Romanian Government To Guarantee Storage Certificates Granted To Farmers

According to the Government decision, the system will be used by private companies which store and trade farming products, as well as companies which own farm land.

Finance Ministry officials will meet on Thursday with farmers and banks, in order to discuss the details of this new program.

The Romanian Fund for the Guarantee of Farming Loans will be capitalized, Wednesday, by the Government, with EUR10 million, to guarantee the storage certificates granted to farmers, in view of selling their products at stimulating prices, finance minister Gheorghe Pogea told MEDIAFAX.

"Today we will capitalize the Farming Loan Guarantee Fund with some EUR10 million, and farmers will have the possibility to store their crops securely in licensed warehouses. They will receive a storage certificate guaranteed by the fund, which they can take to banks and collect the money to continue the farming cycle or to cover payments. Thus, farmers will be able to sell their crops when the market is good," Pogea said.

"Farmers will decide when and at what prices they sell, because their products are guaranteed and they can borrow money until conditions get better," Pogea said.

Farmers can thus store their wheat, without selling it, and based on the storage certificate, guaranteed by the Fund, they can receive a state-guaranteed bank loan.

The loan could represent 70-80% of the storage certificate value.

The certificates are issued when the farmer deposits the wheat in the warehouse, and the quantity will be analyzed, evaluated and, later, stated on the certificate. The price of cereal will be set by the Fund’s managing board, depending on the price of cereal and the one on stock markets.

At the same time, the storage certificate is only granted for wheat, and when the wheat is sold, guarantee rights are voided.