With the assistance of a drought loan from RIC (Regional Investment Corporation), Michelle Walton-Hassell and her husband John have recovered from drought, prepared their mixed farm business for future dry conditions, and improved financial position for succession.
The Hassells are third-generation farmers who own and manage a 2600ha sheep and grain farm at Pingelly, in the Western Australia wheatbelt.
After being impacted by drought conditions between 2017 and 2020, the Hassells successfully applied for the loan.
This enabled the couple to refinance their existing commercial debt and use the improved cash flow from reduced interest payments to install critical new infrastructure.
They built a large hay shed, installed a 250,000-litre water tank and ran underground pipe to drinking troughs. They also paid for earthworks to clean up catchment contours and scrape silt out of 23 dams to improve their water capacity.
Michelle says the improved cash flow from the RIC loan allowed them to make the farm improvements in a short amount of time.
“To do what we wanted to do for drought management, it would have taken us a long time,” she says.
“Going through the RIC loan, we got it done within 12 months, which then put us on a good track.”
The couple grow a mix of crops including canola, barley, oats, lupins, and wheat, but rainfall deficiencies since mid-2023 meant below-average yields.
“The weather hasn’t been kind — a dry finish last year so we didn’t have the grain filled as what we were hoping,” Michelle explains.
They also normally run 3500 non-mulesing merino ewes, producing more than 100 bales a year of fine wool.
Low prices offered at the saleyards meant they have held onto double the number of livestock, putting additional pressure on the available feed.
“We’re going okay, however, if we didn’t do the things we did with our RIC loan then I’m not sure what position we’d be in,” she says.
To meet a key eligibility requirement, the couple submitted a drought management plan which detailed the steps to improve the farm for future climatic challenges.
“We knew what we had to do,” Michelle says.
“But just going through the [drought management plan] process basically formalised it,” she says.
“It had been verbalised but not been put into a written form to tell somebody else this is what we want to do.”
With their improved financial position, the Hassells plan to enact succession arrangements over the next five years to allow their children to take on management of the farm, keeping it in the family.
RIC chief executive John Howard says it is pleasing to see how RIC loans are making a valuable difference to help farm businesses in financial need.
“RIC is delighted to be able to deliver low-interest loans on behalf of the Australian government to support farmers like the Hassells to recover and become more future-ready after facing significant business disruption,” John says.
Recent research from the RIC Farm Loans Insights Brief 2024 highlighted that 89 per cent of RIC-assisted customers agree their RIC loan has given them greater confidence in the future of their farm, while more than half (57 per cent) agree without a RIC loan their farm business would not have survived.
Rural West chief executive Chris Wheatcroft says his team administers the Rural Financial Counselling Service in WA to support farmers and regional small businesses, who are navigating their way through challenges and difficult times.
“RIC loans can be a good option for eligible farmers in financial need to refinance debt, invest in new infrastructure and machinery, and recover from and prepare for natural disasters or other disruptions,” Chris says.
The RIC Drought Loan provides up to $2 million over a 10-year term with the first five years interest only followed by principal and interest for the remaining five years.
The current variable interest rate is 5.18 per cent and there are no fees to apply, make extra repayments, or for early loan repayments.
