The United States Department of Agriculture (USDA) has announced interest rates on loans for May 2021, which go into effect on May 3. USDA Farm Service Agency (FSA) loans provide important access to capital to help agricultural producers start or expand their farms, purchase equipment, and store. structures, or meet cash flow needs.
Operating and property loans
The FSA offers farm ownership and farm loans at favorable interest rates and terms to help eligible agricultural producers, whether multigenerational, long-standing or new to the sector, obtain financing. necessary to start, expand or maintain a family farm. For many loan options, the FSA sets aside funds for historically disadvantaged producers, including beginning farmers and ranchers, women, Native Americans or Alaskan Indians, Asians, Blacks or Afro- Americans, Hawaiian or Pacific Islander Indians, and Hispanic farmers and ranchers.
The interest rates for operating and property loans for May 2021 are as follows:
The FSA also offers secured loans through commercial lenders at rates set by these lenders.
You can find out which of these loans may be right for you by using our Agricultural Loan Discovery Tool.
Loans of commodities and storage facilities
In addition, the FSA provides low-interest financing to producers to build or upgrade on-farm storage facilities and purchase material handling equipment and loans that provide interim financing to help producers meet the needs of the farm. cash without having to sell their products when market prices are low. The funds for these loans are provided by the Commodity Credit Corporation (CCC) and are administered by the FSA.
The FSA also reminds rural communities, farmers and ranchers, families and small businesses affected by winter storms, drought and other natural disasters of the year that the USDA has programs that provide assistance. USDA staff in regional, state, and county offices are prepared with a variety of program flexibilities and other supports to residents, agricultural producers, and affected communities. Many programs are available without an official disaster designation, including several options for risk management and disaster assistance.
Support in the event of a pandemic
Until September 1, 2021, the FSA’s Disaster Set-Aside is available to direct borrowers who have been affected by the pandemic. This allows you to reserve an upcoming annual installment for the year and add it to the last installment. For annual operating loans, the loan maturity date can be extended up to twelve months to set aside the tranche. This provision is normally used following natural disasters, and a second disaster reserve may be available for direct borrowers who already have an DSA in place on a loan due to another designated natural disaster.