USDA

(April 9, 2020) USDA announces Loan Maturity for Marketing Assistance Loans – Now extended to 12 months

Provides Producers with Marketing Flexibilities Amid COVID-19 Uncertainties

WASHINGTON, April 9, 2020 – Agricultural producers now have more time to repay Marketing Assistance Loans (MAL) as part of the U.S. Department of Agriculture’s implementation of the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020. The loans now mature at 12 months rather than nine, and this flexibility is available for most commodities.

“Spring is the season when most producers have the biggest need for capital, and many may have or are considering putting commodities under loan. Extending the commodity loan maturity affords farmers more time to market their commodity and repay their loan at a later time,” said U.S. Secretary of Agriculture Sonny Perdue. “We are extremely pleased that USDA can offer these marketing flexibilities at this critical time for the agriculture industry and the nation.”

Effective immediately, producers of eligible commodities now have up to 12 months to repay their commodity loans. The maturity extension applies to nonrecourse loans for crop years 2018, 2019 and 2020. Eligible open loans must in good standing with a maturity date of March 31, 2020, or later or new crop year (2019 or 2020) loans requested by September 30, 2020. All new loans requested by September 30, 2020, will have a maturity date 12 months following the date of approval.

The maturity extension for current, active loans will be automatically extended an additional 3 months. Loans that matured March 31 have already been automatically extended by USDA’s Farm Service Agency (FSA). Producers who prefer a nine-month loan will need to contact their local FSA county office. Loans requested after September 30, 2020, will have a term of nine months.

 

Eligible commodities include barley, chickpeas (small and large), corn, cotton (upland and extra-long staple), dry peas, grain sorghum, honey, lentils, mohair, oats, peanuts, rice (long and medium grain), soybeans, unshorn pelts, wheat, wool (graded and nongraded); and other oilseeds, including canola, crambe, flaxseed, mustard seed, rapeseed, safflower, sunflower seed, and sesame seed. Seed cotton and sugar are not eligible.

About MALs

Placing commodities under loan provides producers interim financing to meet cash flow needs without having to sell their commodities when market prices are low and allows producers to store production for more orderly marketing of commodities throughout the year. These loans are considered nonrecourse because the commodity is pledged as loan collateral, and producers have the option of delivering the pledged collateral to the Commodity Credit Corporation (CCC) for repayment of the outstanding loan at maturity.

MAL Repayment

Under the new maturity provisions, producers can still repay the loan as they would have before the extension:

  • repay the MAL on or before the maturity date;
  • upon maturity by delivering or forfeiting the commodity to CCC as loan repayment; or
  • after maturity and before CCC acquires the farm-stored commodity by repaying the outstanding MAL principle and interest.

Marketing Loan Gains

A Marketing Loan Gain occurs when a MAL is repaid at less than the loan principal. If market gain is applicable during the now-extended loan period, producers can receive a gain on the repayment made before the loan matures. For more information on MALs, contact the nearest FSA county office. USDA Service Centers, including FSA county offices, are open for business by phone appointment only. More information can be found at www.farmers.gov/coronavirus.

USDA Service Center Hours  

Most service centers are open, but by phone appointment only. If you are unable to connect with your service center by phone, you may contact a neighboring services center to make an appointment. For continuing updates from USDA and to find a service center, visit www.farmers.gov/coronavirus. 

(April 6, 2020) Commodity Credit Corporation CCC Interest Rates Lowered 

The U.S. Department of Agriculture’s Commodity Credit Corporation announced interest rates for April 2020, which are effective April 1-April 30, 2020.  

The Commodity Credit Corporation borrowing rate-based charge for April is 0.625 percent, down from 1.500 percent in March. 

The interest rate for crop year commodity loans less than one year disbursed during April is 1.625 percent, down from 2.500 in March.   

Interest rates for Farm Storage Facility Loans approved for April are as follows: 

  • 0.750 percent with three-year loan terms, down from 1.375 percent in March 
  • 0.750 percent with five-year loan terms, down from 1.375 percent in March 
  • 1.000 percent with seven-year loan terms, down from 1.500 percent in March 
  • 1.000 percent with 10-year loan terms down from 1.625 percent in March, and 
  • 1.125 percent with 12-year loan terms, down from 1.625 percent in March 

The interest rate for 15-year Sugar Storage Facility Loans for April is 1.250 percent, down from 1.750 percent in March.  For more information click here. 

(March 26, 2020) Farm Service Agency 

FSA Services are available by phone appointment only.

FSA staff are available to continue helping agricultural producers with program signups, loan servicing and other important actions. Additionally, FSA is relaxing the loan-making process and adding flexibilities for servicing direct and guaranteed loans to provide credit to producers in need. This includes:  

Relaxing the farm loan-making process by 

  • Extending the deadline for applicants to complete farm loan applications,  
  • Preparing direct loans documents, even if FSA is unable to complete lien and record searches because of closed government buildings,  
  • Closing loans if the required lien position on the primary security is perfected, even for loans that require additional security and those lien searches, filings and recordings cannot be obtained because of closed government buildings.  

Servicing Direct Loans by:

  • Extending deadlines for producers to respond to loan servicing actions,  
  • Temporarily suspending loan accelerations, non-judicial foreclosures, and referring foreclosures to the Department of Justice.  

Servicing Guaranteed Loans by:

  • Allowing guarantee lenders to self-certify, providing their borrowers with subsequent-year operating loan advances on lines of credit and emergency advance son lines of credit,
  • Allowing FSA to consider guaranteed lender requests for temporary payment deferral consideration in certain situations, and temporary forbearance consideration for borrowers on loan liquidation and foreclosure actions. 

FSA will accept forms and applications by fax or electronic signature. If you have an eAuth account you can complete forms online on the farmers.gov portal.  

  • You can find details on these announcementshere. 

(March 27, 2020) Risk Management Agency 

USDA Adds Flexibilities for Crop Insurance to Support America’s Farmers and Ranchers. 

USDA’s Risk Management Agency (RMA) is authorizing additional flexibilities due to coronavirus while continuing to support producers, working through Approved Insurance Providers (AIPs) to deliver services, including processing policies, claims and agreements. These flexibilities include:  

  • Enabling producers to send notifications and reports electronically,  
  • Extending the date for production reports, and  
  • Providing additional time and deferring interest on premium and other payments.  

You can find details on these announcementshere. 

National Agricultural Statistics Service (NASS)

NASS statistical reports remain on schedule amid the COVID-19 pandemic. NASS also continues to collect data for all upcoming reports, asking farmers and ranchers to complete their surveys online, if they don’t already respond that way. To protect the health and safety of producers, partners, and employees, NASS has suspended in-person data collection at least until April 3, 2020.

 

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