FSA reminds producers that USDA offers interim financing after harvest to help producers meet cash flow needs without having to sell commodities when market prices are at harvest-time lows.
2024 commodity loans are available on all crops once the crops are in permanent storage structures. These are among the many tools offered by Farm Service Agency to help farmers navigate price and market conditions.
Prices for most commodities are low this year, and many producers may be storing grain on the farm for delivery later. The ability to deliver grain to river elevators is likely to be affected again this year by the low water levels of the Mississippi River, forcing producers to store grain on the farm at harvest.
The CCC commodity loan programs provide financing and marketing assistance for wheat, grain sorghum, soybeans, rice and cotton producers. Eligibility for loans requires that producers must control the commodity or a title to the commodity until the loan is repaid. Currently, for commodity loans disbursed during August 2022, the interest rate is 5%.
2024 loan rates are as follows: wheat, $3.35 per bushel; corn, $2.35 per bushel; soybeans, $6.35 per bushel; grain sorghum, $2.29 per bushel; and rice, $3.18 per bushel. The cotton base loan rate is 52 cents per pound.
Farm-stored and warehouse-stored loans are available for grains like corn, soybeans, rice, wheat and grain sorghum. Cotton is limited to warehouse-stored loans.
Producers with grain stored in metal on-farm storage bins are the most common type loans in Tallahatchie County. To be eligible for these loans, a producer must obtain lien waiver from their primary lenders and give FSA a first lien through the filing of UCC with Mississippi secretary of state (SOS) in Jackson.
No loan proceeds may be disbursed until the SOS confirms acceptance of the lien and the lien waivers from the producer’s loan lender is received. Therefore, we ask producers that are interested in pursuing a commodity loan with FSA to contact the office prior to the date CCC loan funds are needed to get the liens recorded and waived by primary lenders.
Measurement service from FSA is available to help determine grain bin quantities, or a producer may certify if the quantity is known. Most commodity loans are for nine months and give producers time to wait for price increases after the harvest season or even into the start of the next crop growing season.
If the CCC interest rate is lower than your operating loan interest rate at your bank or your primary lending institution, then you might want to consider a commodity loan. Interest savings of just a few percentage points over several months can help reduce overall interest paid to a producer’s bank.
For more information, contact the Tallahatchie County FSA office at 662-647-8857, ext. 2.
