§7934 Repayment of Loans

Summary

Producers must repay marketing assistance loans for most crops at the lower of two rates: the loan rate for the crop plus interest, or a lower rate the Secretary decides will cut down on loan forfeitures, reduce government stocks and storage costs, help U.S. crops sell freely at home and abroad, and keep loan benefits more even across States and counties. This rule does not apply to upland cotton, rice, extra long staple cotton, confectionery sunflower seed, and other non‑oil sunflower seeds. For upland cotton and rice, repayment must be the lower 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. The Secretary must create a formula and announce the world price for upland cotton and rice. From May 13, 2002, through July 31, 2008, the upland cotton world price is further adjusted if the adjusted world price is less than 115 percent of the loan rate and a specific price test using the Friday‑through‑Thursday average for the lowest‑priced U.S. growth quoted for Middling (M) 13⁄32‑inch cotton delivered C.I.F. Northern Europe exceeds the average of the five lowest‑priced growths. That special adjustment may use U.S. export share, current export sales and shipments, and other relevant data, but cannot exceed the difference between the U.S. lowest‑priced growth average and the Northern Europe price. Repayment for confectionery and other non‑oil sunflower seeds is the lower of the loan rate plus interest or the oil sunflower seed repayment rate. Dry peas, lentils, and small chickpeas repay based on quality grades in section 7932(d). For the 2001 crop year only, producers who lost beneficial interest before repaying may use the repayment rate that was in effect on the date they lost interest if the Secretary finds they acted in good faith.