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Commodity Loans Available to Producers from FSA

(10i/11/12) USDA's Farm Service Agency (FSA) offers 9-month low interest commodity loans as a useful marketing tool for many producers. 

The commodity loan gives producers operating capital at competitive rates and offers flexible repayment at the time the commodity is sold or marketed.

The October interest rate is 1⅛% for all commodity loans.  All farmers are eligible to obtain low interest, 9-month loans for 2012 crops stored on the farm in an eligible structure or at a public warehouse.  The grain must be stored in a facility that is safe and accessible and must be repaid before it is fed.  Producers with grain under loan that will be sold can request a Marketing Authorization which gives them permission to sell the mortgaged collateral to a designated buyer before the loan is repaid.  Ag bags, silos, and oxygen-limited structures are also eligible storage facilities.  Commodity loans will be adjusted for excess moisture. 

Commodity loan eligibility also requires compliance with conservation and wetland protection requirements; beneficial interest requirements, acreage reporting and ensuring that the commodity meets Commodity Credit Corporation minimum grade and quality standards.

This marketing tool is a great way to pay-off higher interest notes with low interest money or to purchase next year's inputs at discounted prices.  For more information on commodity loans please contact the Jackson County FSA Office at 715-284-4515 x2 or visit http://www.fsa.usda.gov.

 

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