Lending rates for June 2021 were announced June 1 by the USDA’s Farm Service Agency, which provides loans meant to help agricultural producers “start or expand their farming operation, purchase equipment and storage structures, or meet cash flow needs.”
A release from the USDA stated, “FSA offers farm ownership and operating loans with favorable interest rates and terms to help eligible agricultural producers, whether multi-generational, long-time or new to the industry, obtain financing needed to start, expand or maintain a family agricultural operation. For many loan options, FSA sets aside funding for historically disadvantaged producers, including beginning, women, American Indian or Alaskan Native, Asian, Black or African American, Native Hawaiian or Pacific Islander, and Hispanic farmers and ranchers.”
Interest rates for Operating and Ownership loans for June 2021 are as follows: Farm Operating Loans (Direct): 1.875 percent; Farm Ownership Loans (Direct): 3.250 percent; Farm Ownership Loans (Direct, Joint Financing): 2.500 percent; Farm Ownership Loans (Down Payment): 1.500 percent; and Emergency Loan (Amount of Actual Loss): 2.875 percent.
The FSA also offers guaranteed loans through commercial lenders at rates set by those lenders.
Additionally, FSA provides low-interest financing to producers “to build or upgrade on-farm storage facilities and purchase handling equipment and loans that provide interim financing to help producers meet cash flow needs without having to sell their commodities when market prices are low.” Funds for these loans are provided through the Commodity Credit Corporation and are administered by FSA and can be found at Commodity Loans (less than one year disbursed): 1.125 percent; Farm Storage Facility Loans including three-year loan terms at 0.375 percent, five-year loan terms at 0. 875 percent, seven-year loan terms at 1.250 percent, 10-year loan terms at 1.625 percent, 12-year loan terms at 1.750 percent and Sugar Storage Facility Loans, 15 years at 2.000 percent.
Additionally, the USDA has programs that provide assistance to rural communities, farmers and ranchers, families and small businesses affected by the year’s winter storms, drought, and other natural disasters.
“USDA staff in the regional, state and county offices are prepared with a variety of program flexibilities and other assistance to residents, agricultural producers and impacted communities. Many programs are available without an official disaster designation, including several risk management and disaster assistance options,” the release said.
Through Sept. 1, “FSA’s Disaster Set-Aside provision is available to direct loan borrowers who have been impacted by the pandemic. This enables an upcoming annual installment to be set aside for the year and added to the final installment. For annual operating loans, the loan maturity date may be extended up to twelve months in order to set aside the installment.”