Farmers May Get LDPs for 2001 Production

July 15, 2002

Some commodity farmers now may be eligible to receive loan deficiency payments (LDPs) for the 2001-crop year even though they did not enroll in the production flexibility contract program under the 1996 farm law.

Under the 1996 law, farmers had the opportunity to sign up for the PFC program, which provided commodity farmers with price support in the form of LDPs. LDPs help offset low commodity prices. However, LDPs could not be made after the final marketing loan availability dates.

Final loan availability dates were March 31, 2002 for wheat, oats, barley, crambe, flaxseed, and rapeseed; May 31, 2002, for corn, soybeans, sunflower, seed, grain sorghum, mustard seed, and safflower seed. The 2002 farm law mandates that those dates not limit availability of LDPs. To ensure program equity, the provisions are being extended to PFC farms as well.

"The farm bill extends LDPs to commodities produced on non-PFC farms in 2001," said Farm Service Agency Administrator Jim Little. "Additionally, production for which producers have lost beneficial interest may also now be eligible for LDPs, if certain conditions are met."

A producer loses "beneficial interest" when he or she no longer owns a particular commodity or otherwise has control of it. The producer cannot, however, have previously obtained a marketing loan or LDP with respect to that specific quantity of the commodity.

Producers should contact their local USDA Service Centers to determine if they are eligible for LDPs may have to meet other requirements and for more information.