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. 2023 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. This year, prices for commodities are much better that the past few years but many producers may be storing grain on the farm for delivery later. Commodity markets have been greatly affected by world events and will continue to be affected over the foreseeable future.
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, interest rate is 4%. 2023 loan rates are as follows: wheat, 3.35/bushel; corn, 2.35/bushel; soybeans, 6.41/bushel; grain sorghum, 2.29/bushel; and rice, 3.18/bushel. Cotton base loan rate is 52 cents per pound.
Farm-stored, and warehouse-stored loans are available for loans on 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 in Jackson. No loan proceeds may be disbursed until the SOS confirms acceptance of the lien. 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 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 September 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.
For more information, contact the Tallahatchie County FSA office at 662-647-8857, ext. 2.
