WASHINGTON, Jan. 28, 2009 - Agriculture Secretary Tom Vilsack said today that the Commodity Credit Corporation (CCC) will make $490 million available in partial 2008 Counter-cyclical Program (CCP) payments to eligible producers with enrolled upland cotton base acres in the Direct and Counter-cyclical Program (DCP). The projected partial CCP rate for producers with enrolled upland cotton base acres is 5.03 cents per pound or 40 percent of the projected total rate of 12.58 cents per pound.
USDA's Commodity Credit Corporation (CCC) marketing assistance loans (MAL) are a marketing tool producers can use to store their production after harvest, which increases their marketing opportunities. In place of using MALs, producers may elect to take a loan deficiency payment (LDP) that provides a payment equal to any net gain from a MAL.
This fact sheet explains various fees and charges associated with cotton MALs, LDPs, and the relocation of cotton loan collateral.
USDA Registry for Cotton Merchants
USDA's Farm Service Agency (FSA) maintains an internal-use-only national registry to help cotton merchants efficiently redeem cotton held as collateral by USDA.
Direct and Counter-cyclical Payment (DCP) Program
The Farm Security and Rural Investment Act of 2002 (2002 Act) replaced production flexibility contract (PFC) payments (created under the 1996 Act) with direct payments and added new counter-cyclical payments for the 2002-2007 crops. DCP payments are based on historical acreage bases and payment yields, not current production. In addition to upland cotton, other eligible commodities are wheat, corn, barley, grain sorghum, oats, rice, soybeans, other oilseeds, and peanuts.
Rice Nonrecourse Marketing Assistance Loan and Loan Deficiency Payment
The Food, Conservation, and Energy Act of 2008 (2008 Act) reauthorizes nonrecourse marketing assistance loans (MALs) and loan deficiency payment (LDPs) for the 2008 through 2012 crop of rice.
Nonrecourse MALs and LDPs are administered by the Farm Service Agency (FSA), on behalf of the Commodity Credit Corporation (CCC). See the fact sheet "Nonrecourse Marketing Assistance Loans/Loan Deficiency Payments" for additional information about MALs and LDPs.
Rice Nonrecourse Marketing Assistance Loans
Rice nonrecourse MALs provide eligible producers with interim financing on their production. Instead of selling the crop immediately at harvest, producers may pledge their production as loan collateral, receiving loan proceeds equal to the loan rate times the quantity placed under loan.
Under marketing loan provisions, rice producers may repay a MAL at the lower of the loan rate plus accrued interest or the adjusted world price (AWP). If the AWP is lower than the loan rate, the amount by which the loan rate exceeds the AWP is the marketing loan gain (MLG) rate.
Producers also are eligible for a loan deficiency payment (LDP) in lieu of obtaining a MAL. The LDP rate is the amount by which the loan rate exceeds the AWP-the same as the MLG rate.
Eligibility: Rice Quality Requirements
Rice (Oryza Sativa L.) must meet the definition for rough rice provided in the U.S. Standards for Rice, including rice of special grade designations. Grains referred to as wild rice (Zizania aquatic L.) are ineligible.
Aromatic rice (such as Jasmine varieties) must be pledged under a loan agreement separate from non-aromatic rice and stored separately from non-aromatic rice. When aromatic rice is delivered to USDA's Commodity Credit Corporation (CCC), it must be delivered to a CCC-approved facility able and willing to store such rice on an identity preserved basis, i.e. aromatic rice may not be commingled with non-aromatic rice. Producers shall not receive any credit for expenses incurred in the delivery of aromatic rice to storage.
The national average loan rate for 2009 through 2012 crops of long grain and medium/shortgrain rough rice is $6.50 per hundredweight (cwt). To achieve the national average rate and provide rate adjustments for different classes and milling qualities, separate loan rates are provided for whole and broken-milled rice kernels. For 2011-crop rice, the whole kernel loan rate is $9.93 per cwt for long grain and $9.55 per cwt for medium/short grain. The 2011 broken kernel loan rate for all classes is $7.06 per cwt.
Farm-and Warehouse-Stored Loan Rates
Loan rates for farm-stored rice (or rice for which the grade and milling yield are not determined) are based on state average grade and milling qualities for the prior five years. The farm-stored marketing assistance loan rates for 2011-crop rough rice are:
Other - U.S. Average