§9040 — Title 7 Agriculture | U.S. Code

Summary

The Secretary can change loan rates for farm crops (except cotton) to account for things like grade, type, quality, location, and other differences. Those changes should be made so that, on average, the loan level for a crop equals the support level expected when those differences are taken into account. The Secretary may set different county loan rates so the lowest county rate is 95 percent of the national average, as long as doing that does not raise government outlays or increase the national average loan rate in any year. For cotton, the Secretary may change loan rates for quality differences and may use price data beyond just spot-market prices. The Secretary may also adjust premiums or discounts for upland cotton with a staple length of 33 or above because of micronaire to avoid artificial breaks, and make other changes after consulting U.S. cotton industry representatives. Chapter 10 of Title 5 does not apply to those consultations. The Secretary can review, revise, or cancel any cotton quality adjustments. For long-grain and medium-grain rice, the Secretary cannot change loan rates except for grade and quality differences, including milling yields.

Title 7, §9040

Agriculture — Source: USLM XML via OLRC

(a)Subject to subsection (e), the Secretary may make appropriate adjustments in the loan rates for any loan commodity (other than cotton) for differences in grade, type, quality, location, and other factors.

(b)The adjustments under subsection (a) shall, to the maximum extent practicable, be made in such a manner that the average loan level for the commodity will, on the basis of the anticipated incidence of the factors, be equal to the level of support determined in accordance with this subchapter and subtitle C.

(c)(1)The Secretary may establish loan rates for a crop for producers in individual counties in a manner that results in the lowest loan rate being 95 percent of the national average loan rate, if those loan rates do not result in an increase in outlays.

(2)Adjustments under this subsection shall not result in an increase in the national average loan rate for any year.

(d)(1)The Secretary may make appropriate adjustments in the loan rate for cotton for differences in quality factors.

(2)Loan rate adjustments under paragraph (1) may include—

(A)the use of non-spot market price data, in addition to spot market price data, that would enhance the accuracy of the price information used in determining quality adjustments under this subsection;

(B)adjustments in the premiums or discounts associated with upland cotton with a staple length of 33 or above due to micronaire with the goal of eliminating any unnecessary artificial splits in the calculations of the premiums or discounts; and

(C)such other adjustments as the Secretary determines appropriate, after consultations conducted in accordance with paragraph (3).

(3)(A)In making adjustments to the loan rate for cotton (including any review of the adjustments) as provided in this subsection, the Secretary shall consult with representatives of the United States cotton industry.

(B)Chapter 10 of title 5 shall not apply to consultations under this subsection.

(4)The Secretary may review the operation of the upland cotton quality adjustments implemented pursuant to this subsection and may make further adjustments to the administration of the loan program for upland cotton, by revoking or revising any adjustment taken under paragraph (2).

(e)The Secretary shall not make adjustments in the loan rates for long grain rice and medium grain rice, except for differences in grade and quality (including milling yields).

Notes & Related Subsidiaries

Editorial Notes

References in Text

Subtitle C, referred to in subsec. (b), means subtitle C of title I of Pub. L. 113–79, Feb. 7, 2014, 128 Stat. 687, which amended section 1359bb, 1359ll, and 7272 of this title.

Amendments

2022—Subsec. (d)(3)(B). Pub. L. 117–286 substituted “chapter 10 of title 5” for “Federal Advisory Committee Act” in heading and “Chapter 10 of title 5” for “The Federal Advisory Committee Act (5 U.S.C. App.)” in text.

§9040 Adjustments of Loans