There has been an increase in the number of agricultural and farming loans extended by banks to doctors, lawyers, teachers and others who had never before engaged in the sector.
Observers say the main reason behind the increase in interest seems to be Farmville, a real-time Facebook simulation game in which users manage a virtual farm. A feasibility expert who spoke with the Star daily yesterday but whose identity was not revealed said some new farming entrepreneurs had asked questions inquiring whether cows bite or how many babies they have.
Turkey’s Ziraat Bankası offers loans for agricultural activities. Their loans are given on the basis of selective criteria, such as the need for a project to include building a new farm or buying livestock. In return for the loan, the bank also puts a lien on the property. Despite these conditions, interest shown in farming loans has soared.
Feasibility experts who audit the projects say many a new entrepreneur had confessed that they became interested in the farming business through Farmville. According to Star’s report, the surge in interest also led to an increase in sheep-tending rates. The uninitiated farming investors usually hire shepherds for their newly established businesses. The monthly salary for a shepherd has gone up to TL 1,500 in the past few months.
Professionals confirm urban interest
Erzurum Chamber of Agriculture President Mücahit Harmandar said livestock breeding has been increasingly popular among urban dwellers, particularly due to its higher profit yield in the past few years. “Livestock farming, seen in the past as only something to be done by villagers, is now whetting the appetite of the urbanite,” he added. Harmandar said with a shortage of small cattle in Turkey, the demand for meat has been increasing. He stated that in addition to higher demand, incentives offered by the state for livestock breeders also contributed to the growing attraction of this sector.
Harmandar also pointed to state-sponsored loans that include donations of up to 30 percent in construction of stalls and up to 40 percent in the purchase of livestock and the construction of milking units. He said many investors in various sectors were now moving to animal farming to make use of the incentives. “Those who want to engage in agriculture and livestock tending apply to us for farming certificates. We have had applications from a large number of urban dwellers as this sector is increasingly more profitable. More than 20 people in the Central Anatolian province of Erzurum and about 1,000 others from other districts applied to be included in the farmer registry. Many of these are people who have invested in other sectors before,” Harmandar explained. Ahmet Ahıskalı from the local directorate of agriculture in Erzurum said 24 investors had submitted project proposals this year. He said 22 of these were accepted and that eight of them will soon begin operating. “Eight facilities will be constructed as part of the Eastern Anatolia Project [a development project targeting the region]. Some of these [investors] have even completed the construction of stalls. These facilities will have a capacity to hold 1,225 cattle in total.”
Ahıskalı said most of the project owners were investors from the province. “There are people who came from İstanbul to construct barns here. An investor who built a 300-cattle facility in the Cinis village, for example, is from İstanbul. He had previously been in the public transportation sector, but sold his bus for this investment,” he said.
No interest loans
From the beginning of August to the end of October Ziraat Bankası issued TL 1.3 billion in loans for cattle industry investors. The loans carry a term of seven years and are given on the basis of no-payment for the first two years. A total of 18,774 individuals have borrowed this type of loan in the stated period.