Low-Interest Commodity Loans are Available at Your local FSA Office
By Daniel Root
Date Modified: 11/21/2012 1:21 PM
Marketing assistance loans are available at your local FSA office for 2012 eligible commodities. Producers should take advantage of low-interest loans to provide interim financing at harvest to help meet cash flow needs for the upcoming 2013 crop year. Once an eligible commodity is in storage, producers can contact their local FSA office to make an application. A typical loan request usually takes less than a week to process. The FSA office has to complete a lien search and lien filing before the loan can be disbursed.
Farm Stored Commodity Loans:
Certified Loan - You can obtain a loan based off of a quantity certified at your FSA office.
Measured Loan - You can pay for a measurement service to have the FSA office measure your grain in storage and obtain a loan based off of the measured quantity. The measurement service fee will be a minimum of $46 per location.
Warehouse Stored Commodity Loans: Bring in a warehouse receipt from an eligible elevator with a statement that indicates you have made arrangements to cover the storage costs and you can receive a loan based off of the quantity indicated on the warehouse receipt. Each warehouse receipt(s) must be in the amount of bushels you intend to sell at one time. Each warehouse receipt must be repaid for all bushels under that receipt.
High Moisture Corn Loans: Producers can receive a recourse commodity loan for high moisture corn. Producers can receive the full loan rate for high moisture corn loans, yet bushels will be reduced to reflect moisture at dry bushels. High moisture corn must be stored in a structure that has been approved by the County Committee. Recourse loans cannot be forfeited and must be paid at principal and interest.
Interest Rate: The October interest rate for a nine-month commodity loan is 1.125 percent.
ACRE Farms: The loan rate will be reduced by 30 percent for all ACRE Farms.
Loan Servicing Fees: The loan service fee is the smaller of $45 for the first structure or warehouse receipt and $3 for each additional structure or receipt or one half of one percent times the gross loan amount.
Settlement: Loans mature on the last day of the ninth calendar month following the month in which the loan is approved. Loans may be settled by either repaying the loan by the maturity date or forfeiting the commodity to CCC upon maturity. There is no penalty for paying off your commodity loan early. Example: Commodity Loan was approved in October 2012 – Loan Maturity will be July 31, 2013.
Hauling Loaned Grain: Before any loan grain is hauled to market, producers must obtain a marketing authorization or pay off loan bushels in advance. Please contact your FSA office before you haul any loan grain.
Contact your FSA office if you have any questions regarding the Marketing Assistance Loan Program.