WASHINGTON – Farmers now have more time to repay US Department of Marketing Assistance (MAL) loans
of the implementation by the CARES law (2020, Coronavirus Aid, Relief and Economic Security Act). Loans mature at 12 months instead of nine, and this flexibility is available for most products.
“Spring is the season when most producers are most in need of capital, and many can or are planning to
ready. Extending the maturity of product loans gives farmers more time to market their products and pay off their loans later, “said US Secretary of Agriculture Sonny Perdue. “We are extremely pleased that the USDA can offer these marketing flexibilities
at this critical moment for the agricultural industry and the nation. “
As of today, producers of eligible products now have up to 12 months to repay their product loans. The maturity extension applies
non-recourse loans for the 2018, 2019 and 2020 crop years. Eligible open loans must be in good standing with a maturity date of March 31, 2020, or later or a new crop year (2019 or 2020) requested before 30 September 2020. All new loans applied for by September
30 2020 will have a maturity date 12 months after the date of approval.
The maturity extension for current and active loans will automatically be extended by an additional 3 months. Loans maturing on March 31 have already
automatically extended by the USDA Farm Service Agency (FSA). Producers who prefer a nine-month loan will need to contact their local FSA county office. Loans requested after September 30, 2020 will have a term of nine months.
Eligible products include barley, chickpeas (small and large), corn, cotton (basic and extra-long basic), dry peas, grains
sorghum, honey, lentils, mohair, oats, peanuts, rice (long and medium grain), soybeans, uncut skins, wheat, wool (graded and not negotiated); and other oilseeds, including canola, crambe, flax, mustard seeds, rapeseed, safflower, sunflower seeds and sesame seeds
seed. Seed cotton and sugar are not eligible.
Lending commodities provides producers with interim financing to meet cash flow needs without having to sell their products when the market
prices are low and allow producers to store production for a more orderly marketing of products throughout the year.
These loans are considered non-recourse because the product is given as a loan guarantee and producers have the possibility of
collateralization of the Commodity Credit Corporation (CCC) guarantee for the repayment of the outstanding loan at maturity.
Under the new maturity provisions, producers can still repay the loan as they would have done before the extension:
- reimburse the MAL on or before the due date;
- at maturity by delivering or confiscating the product from the CCC as a loan repayment;
- after the due date and before the CCC acquires the product stored on the farm by reimbursing
exceptional MAL principle and interest.
Gains on Marketing Loans
A marketing loan gain occurs when an MAL is repaid at an amount less than the principal of the loan. If a market gain is applicable during
With the loan period now extended, producers can receive a gain on the repayment made before the loan matures.
For more information on MAL, contact the nearest FSA county office. USDA service centers, including FSA county offices, are open for business
by appointment only by phone, and the field work will continue with an appropriate social distancing. Although program delivery staff will continue to come to the office, they will work with producers over the phone and use online tools where possible. All the services
Visitors to the center who wish to do business with the FSA, the Natural Resources Conservation Service or any other agency in the service center should call their service center to set up a telephone appointment. More information can be found on