Drought Relief Loan

The program is available to eligible primary production enterprises located in NSW experiencing the impacts of drought.

An eligible primary production enterprise:

• is a sole trader, partnership, trust or private company in NSW and
• has an Australian Business Number (ABN) and declares itself for tax purposes in Australia as a primary producer and
• is not a public company under the meaning of the Corporations Act 2011 (Cth) and
• at least one owner (sole trader, partner, shareholder or beneficiary) contributes part of their labour to the enterprise and
• in at least one of the last 3 financial years has generated annual gross income (the total income earned before any tax deductions) from eligible primary production income of at least:
  • $75,000 and no more than $5 million in total gross income or
  • 50% of its gross income is from eligible primary production income.
• Where eligible primary production income is less than $75,000 or 50% of total gross income, the applicant can demonstrate that in the ordinary course of business, they would meet that requirement, but:
  • their primary production gross income is currently reduced due to seasonal conditions or biosecurity events and/or
  • due to long lead times to full production, in the opinion of the RAA, they will earn such an amount of gross eligible primary production income within a reasonable period (taking into account the nature of the industry)
• can demonstrate that the business has long-term viability and has the capacity to repay the loan sought (this will include an assessment of related directors and owners).

Note: Eligible primary production income:

• includes income from the ANZSIC Codes for Agriculture, Forestry and Fishing
• includes income from value-added products (e.g. wine) made directly from raw produce grown by the enterprise
• includes gross income from carbon abatement projects deemed eligible primary production gross income by the Australian Tax Office
• excludes gross income from activities that involve animals that are not bred for farm work, food or fibre; hunting and trapping activities; or agriculture, forestry and fishing support services.

The Drought Relief Loan can be used to fund drought-related activities that support the primary production enterprises experiencing the impacts of drought. Eligible activities are listed in Sections 5.3 to 5.5 of the Program Guidelines.

Activities that commenced (ordered, purchased, or installed) on or after 16 February 2026 may be claimed.

Animal welfare

• Purchasing and transporting fodder.
• Purchasing and transporting stock and domestic water.
• Purchasing livestock feed storage, mixing and feeding equipment.
• Transporting stock to sale or agistment.
• Veterinary/professional nutrition or animal welfare advice.  
• Genetic banking where destocking of stock is demonstrated.
• Fencing for rotational grazing, exclusion and cluster fencing, construction of containment feeding pens, stock shade structures. 

On-farm infrastructure

• On-farm water infrastructure (tanks, stock water systems, pumps, drilling bores, desalination or water quality equipment and related repairs).
• Dam maintenance earthworks.
• On-farm grain and fodder storage infrastructure (silos, grain bunkers, hay sheds, silage pits, etc).
• Livestock feeding equipment.

Environmental improvements

• Pest and weed control.
• Soil conservation and earthworks (including erosion control, contour banks, overbanks (keyline), water ponding and the management of vegetation and maintaining groundcover.

Important information

Loan value 

• A loan of up to 100% of the net GST-exclusive cost of the eligible activity, to a maximum of $100,000 per eligible primary production enterprise, including an initial upfront payment to a maximum amount of $25,000. The upfront payment will be determined by the approved loan amount.
• Minimum loan amount is $25,000. 

Drawdown 

• Once all loan documents have been successfully executed and your application is approved, the Rural Assistance Authority (the RAA) will release the first drawdown equal to 25% of the total approved loan without the need to provide invoices or supporting evidence.
• The loan must be fully drawn down within 6 months from the date the loan is established, that is, after receipt of the signed and dated letter of offer.

Interest rate 

• Interest rates change monthly in line with market conditions, and the confirmed fixed interest rate for the loan will be the interest rate at the time of the first drawdown. Current rates are published on the RAA website.
• Interest accrues from the first drawdown of the loan.

Term 

• The maximum loan term is 5 years.

Repayments 

• Loan repayments are interest-only from the first drawdown until either the loan is fully drawn down or six months after acceptance of the letter of offer, whichever occurs first. After this period, repayments are principal and interest.
• Loan repayment terms are approved at the discretion of the RAA.

Fees and charges 

• There are no ongoing account-keeping fees.
• You must cover the costs for credit checks, bankruptcy and company search where applicable.

Activities that cannot be supported by a Drought Relief Loan include:

• activities that commenced (ordered, purchases or installed) prior to 16 February 2026
• all residential farm premises/buildings and/or improvements to the residential farm premises/buildings
• activities beyond/outside the farm gate
• own labour costs and employee wages
• activities that have been used to secure funding under any other NSW Government scheme, including funding administered by the RAA (this includes past and future programs).