Maximum loan amounts for individual farmers under Farm Service Agency (FSA) programs would be increased in response to lagging commodity prices under legislation announced on Thursday.
Under the Capital for Farmers and Ranchers Act, maximum loan amounts for individual farmers ranchers and producers would be increased under FSA’s direct and guaranteed loan programs for farm operating loans and form ownership loans.
U.S. Sen. John Hoeven (R-ND), the chairman of the Senate Appropriations Subcommittee on Agriculture, announced that he would reintroduce the bill in response to calls from farm industry groups like the American Soybean Association (ASA).
Citing debt-to-asset ratios, working capital and cash flows that are projected to continue to weaken, ASA representatives requested that congressional appropriations approve additional funding for FSA loans, which “serve as an important lifeline for many distressed producers,” in a June letter.
“Inadequately funding FSA would be a disservice to our hardworking farmers and ranchers, who are dedicated to feeding our nation and the world,” the letter continues.
Congress approved an increase of approximately $1.4 billion for FSA’s farm loan programs as part of the fiscal year 2017 Consolidated Appropriations Act. The ASA letter notes that, “The outlook for 2017 grain and livestock prices appears to be no better than in 2016, likely meaning FSA loans will be even more vital to the financial viability of farm and ranch operations.”