WASHINGTON (CN) – Millions of government dollars will increase the amount available for low-interest Farm Storage Facility Loans to help mostly large farms store their product. Among the farms are those that grow corn for ethanol.
Storage allows farmers flexibility to wait for a better commodity price.
The additional costs for this implementation of the Food, Conservation, and Energy Act of 2008 are $6 million in 2009, $28 million in 2010, $30 million in 2011, and $32 million in 2012.
The Commodity Credit Corporation rule adds hay and renewable biomass as eligible FSFL commodities. The maximum loan term is extended to 12 years, and the maximum loan amount is increased to $500,000, over a maximum loan amount of $100,000 per borrower.
Fruits and vegetables (including nuts) also are added as eligible facility loan commodities. Cold storage facilities, which allow the removal of “field heat” before the produce goes to market, also are eligible.
In addition, the new rule removes a provision that would disallow loans under the program if the agency determines that there is not a shortage of grain storage in the area of the producer.