December 19, 2000

USDA has set marketing assistance loan rates for 2001-crop wheat, feed grains, oilseeds, upland and ELS cotton, and rice at the maximum levels. Loan rates for wheat, corn, soybeans, and minor oilseeds are required to be no less than 85% of the simple average of prices received by producers during the immediately preceding five years, excluding the high and low years.

The announced rates are wheat, $2.58 per bushel; minor oilseeds, $9.30 per hundredweight; corn, $1.89 per bushel; crambe and sesame, $8.77 per hundredweight; grain sorghum, $1.68 per bushel; upland cotton, 51.92 cents per pound; barley, $1.65 per bushel; ELS cotton, 79.65 cents per pound; oats, $1.21 per bushel; rice, $6.50 per hundredweight and soybeans, $5.26 per bushel

Loan rates may not exceed $2.58 per bushel for wheat, $1.89 per bushel for corn, $5.26 per bushel for soybeans, and $9.30 per hundredweight for minor oilseeds. Marketing assistance loan rates for other feed grains (grain sorghum, barley, and oats) are to be set relative to the corn loan rate, taking into consideration their feeding value relative to corn. The rate for minor oilseeds (sunflower seed, canola, rapeseed, safflower, mustard seed, and flaxseed) is set using market prices for sunflower seed. The rates for crambe and sesame are set on a pound-per-pound basis compared with the soybean loan rate.

Even though the formula-based loan rates for wheat, corn, soybeans, and minor oilseeds would allow setting the rates at lower levels, USDA chose to set the loan rates at their respective statutory maximum levels. According to Agriculture Secretary Dan Glickman, lower marketing assistance loan rates would weaken the safety net for producers of wheat, feed grains and oilseeds during a critical period of financial need.

The formula based loan rates for upland cotton and ELS cotton both exceed their respective statutory maximums. Thus, the upland cotton loan rate is set at its maximum allowable level of 51.92 cents per pound, and the ELS cotton loan rate is set set at its maximum allowable level of 79.65 cents per pound. The rice loan rate is statutorily set at $6.50 per hundredweight.

Revisions made to the marketing loan program for other-type sunflower seed (often referred to as confection sunflower seed) for the 2000 crop year will remain in effect for the 2001 crop year. Under these revisions, the county loan rates and loan repayment rates for other-type sunflower seed will be the same as for oil-type sunflower seed, except the loan repayment rate for other-type sunflower seed may not fall more than $3.00 per hundredweight below its respective county loan rate.

Further program information is available from Philip Sronce at (202) 720-2711, E-mail address: phil_sronce@wdc.fsa.usda.gov.