§7934 Repayment of Loans

Summary

The Agriculture Secretary must let farmers repay marketing-assistance loans using the lower of two amounts. For most crops (not including upland cotton, rice, extra long staple cotton, and certain sunflower types), repayment is the lesser of the loan rate plus interest (set under another law) or a rate the Secretary picks to reduce loan forfeitures, cut government stockpiles and storage costs, keep U.S. crops competitive at home and abroad, and make benefits more even across states and counties. For upland cotton and rice, repayment is the lesser of the loan rate plus interest or the prevailing world market price adjusted to U.S. quality and location. Extra long staple cotton must be repaid at the loan rate plus interest. Confectionery and other non-oil sunflower seeds are repaid at the lower of the loan rate plus interest or the oil sunflower seed repayment rate. Dry peas, lentils, and small chickpeas use the quality grades in section 7932(d) to set their repayment rate. The Secretary must write rules that explain how to calculate and announce the prevailing world market price for upland cotton and rice. From May 13, 2002, through July 31, 2008, the world price for upland cotton is adjusted if the world price is less than 115 percent of the loan rate and the U.S. price for the lowest-priced growth (Middling 13/32‑inch, C.I.F. Northern Europe) is higher than the average of the five lowest-priced growths (the “Northern Europe price”). That adjustment can use data like U.S. export share, export sales and shipments, and other relevant information, but it cannot be larger than the difference between the U.S. lowest-priced growth price and the Northern Europe price. For the 2001 crop year only, if producers lost beneficial interest in the crop before repaying but the Secretary finds they acted in good faith, they may repay at the rate that was in effect when they lost that interest.