USDA announces new county loan rates

Because it restructured the national loan rates, the new farm bill required USDA to make changes in county loan rates for all of the 2002 crops. USDA also updated the terminal markets used by the Commodity Credit Corp. to establish posted county prices or PCPs. The latter are used for redeeming marketing loans.

“The new county loan rate structure, which provides upward changes in most areas, reflects the most comprehensive adjustments in more than 15 years,” the USDA’s Farm Service Agency said in a press release.

“The changes are intended to reduce cumulative market distortions and loan deficiency payment (LDP) disparities that have emerged over the years. Some of the existing county loan rates trace to 1985and no longer reflects the geographic pattern of market prices.”

FSA said the exception is soybean loan rates, which generally have been adjusted annually, thus avoiding significant distortions and disparities among local areas.

“This restructuring is consistent with guidance provided by House/Senate Conferees for the 2002 Act and their expectation that the Secretary of Agriculture would utilize the generally upward changes in national loan rates to revise county loan rates,” the press release said.

The Agriculture Department’s announcement included:

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