7 U.S.C. § 7232 — Loan rates for marketing assistance loans

Page 1976 TITLE 7—AGRICULTURE § 7232 outlays under this subchapter as a result of the reconstitution of a farm that occurs as a result of the combination of another farm that does not contain eligible cropland covered by a pro- duction flexibility contract. (Pub. L. 104–127, title I, § 131, Apr. 4, 1996, 110 Stat. 905.) Editorial Notes REFERENCES IN TEXT The Food Security Act of 1985, referred to in subsec. (c), is Pub. L. 99–198, Dec. 23, 1985, 99 Stat. 1354. Sub- titles B and C of title XII of the Act are classified gen- erally to subchapters II (§ 3811 et seq.) and III (§ 3821 et seq.), respectively, of chapter 58 of Title 16, Conserva- tion. For complete classification of this Act to the Code, see Short Title of 1985 Amendment note set out under section 1281 of this title and Tables. § 7232. Loan rates for marketing assistance loans (a) Wheat (1) Loan rate Subject to paragraph (2), the loan rate for a marketing assistance loan under section 7231 of this title for wheat shall be— (A) not less than 85 percent of the simple average price received by producers of wheat, as determined by the Secretary, dur- ing the marketing years for the immediately preceding 5 crops of wheat, excluding the year in which the average price was the highest and the year in which the average price was the lowest in the period; but (B) not more than $2.58 per bushel. (2) Stocks to use ratio adjustment If the Secretary estimates for any mar- keting year that the ratio of ending stocks of wheat to total use for the marketing year will be— (A) equal to or greater than 30 percent, the Secretary may reduce the loan rate for wheat for the corresponding crop by an amount not to exceed 10 percent in any year; (B) less than 30 percent but not less than 15 percent, the Secretary may reduce the loan rate for wheat for the corresponding crop by an amount not to exceed 5 percent in any year; or (C) less than 15 percent, the Secretary may not reduce the loan rate for wheat for the corresponding crop. (b) Feed grains (1) Loan rate for corn Subject to paragraph (2), the loan rate for a marketing assistance loan under section 7231 of this title for corn shall be— (A) not less than 85 percent of the simple average price received by producers of corn, as determined by the Secretary, during the marketing years for the immediately pre- ceding 5 crops of corn, excluding the year in which the average price was the highest and the year in which the average price was the lowest in the period; but (B) not more than $1.89 per bushel. (2) Stocks to use ratio adjustment If the Secretary estimates for any mar- keting year that the ratio of ending stocks of corn to total use for the marketing year will be— (A) equal to or greater than 25 percent, the Secretary may reduce the loan rate for corn for the corresponding crop by an amount not to exceed 10 percent in any year; (B) less than 25 percent but not less than 12.5 percent, the Secretary may reduce the loan rate for corn for the corresponding crop by an amount not to exceed 5 percent in any year; or (C) less than 12.5 percent, the Secretary may not reduce the loan rate for corn for the corresponding crop. (3) Other feed grains The loan rate for a marketing assistance loan under section 7231 of this title for grain sorghum, barley, and oats, respectively, shall be established at such level as the Secretary determines is fair and reasonable in relation to the rate that loans are made available for corn, taking into consideration the feeding value of the commodity in relation to corn. (c) Upland cotton (1) Loan rate Subject to paragraph (2), the loan rate for a marketing assistance loan under section 7231 of this title for upland cotton shall be estab- lished by the Secretary at such loan rate, per pound, as will reflect for the base quality of upland cotton, as determined by the Sec- retary, at average locations in the United States a rate that is not less than the smaller of— (A) 85 percent of the average price (weight- ed by market and month) of the base quality of cotton as quoted in the designated United States spot markets during 3 years of the 5- year period ending July 31 of the year pre- ceding the year in which the crop is planted, excluding the year in which the average price was the highest and the year in which the average price was the lowest in the pe- riod; or (B) 90 percent of the average, for the 15- week period beginning July 1 of the year preceding the year in which the crop is planted, of the 5 lowest-priced growths of the growths quoted for Middling 13⁄32-inch cotton C.I.F. Northern Europe (adjusted downward by the average difference during the period April 15 through October 15 of the year pre- ceding the year in which the crop is planted between the average Northern European price quotation of such quality of cotton and the market quotations in the designated United States spot markets for the base quality of upland cotton), as determined by the Secretary. (2) Limitations The loan rate for a marketing assistance loan for upland cotton shall not be less than $0.50 per pound or more than $0.5192 per pound. (d) Extra long staple cotton The loan rate for a marketing assistance loan under section 7231 of this title for extra long sta- ple cotton shall be— (1) not less than 85 percent of the simple av- erage price received by producers of extra long Page 1977 TITLE 7—AGRICULTURE § 7234 staple cotton, as determined by the Secretary, during 3 years of the 5-year period ending July 31 of the year preceding the year in which the crop is planted, excluding the year in which the average price was the highest and the year in which the average price was the lowest in the period; but (2) not more than $0.7965 per pound. (e) Rice The loan rate for a marketing assistance loan under section 7231 of this title for rice shall be $6.50 per hundredweight. (f) Oilseeds (1) Soybeans The loan rate for a marketing assistance loan under section 7231 of this title for soy- beans shall be— (A) not less than 85 percent of the simple average price received by producers of soy- beans, as determined by the Secretary, dur- ing the marketing years for the immediately preceding 5 crops of soybeans, excluding the year in which the average price was the highest and the year in which the average price was the lowest in the period; but (B) not less than $4.92 or more than $5.26 per bushel. (2) Sunflower seed, canola, rapeseed, safflower, mustard seed, and flaxseed The loan rate for a marketing assistance loan under section 7231 of this title for sun- flower seed, canola, rapeseed, safflower, mus- tard seed, and flaxseed, individually, shall be— (A) not less than 85 percent of the simple average price received by producers of sun- flower seed, individually, as determined by the Secretary, during the marketing years for the immediately preceding 5 crops of sunflower seed, individually, excluding the year in which the average price was the highest and the year in which the average price was the lowest in the period; but (B) not less than $0.087 or more than $0.093 per pound. (3) Other oilseeds The loan rates for a marketing assistance loan under section 7231 of this title for other oilseeds shall be established at such level as the Secretary determines is fair and reason- able in relation to the loan rate available for soybeans, except in no event shall the rate for the oilseeds (other than cottonseed) be less than the rate established for soybeans on a per-pound basis for the same crop. (Pub. L. 104–127, title I, § 132, Apr. 4, 1996, 110 Stat. 905.) § 7233. Term of loans (a) Term of loan In the case of each loan commodity (other than upland cotton or extra long staple cotton), a marketing assistance loan under section 7231 of this title shall have a term of 9 months begin- ning on the first day of the first month after the month in which the loan is made. (b) Special rule for cotton A marketing assistance loan for upland cotton or extra long staple cotton shall have a term of 10 months beginning on the first day of the month in which the loan is made. (c) Extensions prohibited The Secretary may not extend the term of a marketing assistance loan for any loan com- modity. (Pub. L. 104–127, title I, § 133, Apr. 4, 1996, 110 Stat. 907.) § 7234. Repayment of loans (a) Repayment rates for wheat, feed grains, and oilseeds The Secretary shall permit a producer to repay a marketing assistance loan under section 7231 of this title for wheat, corn, grain sorghum, barley, oats, and oilseeds at a rate that is the lesser of— (1) the loan rate established for the com- modity under section 7232 of this title, plus in- terest (as determined by the Secretary); or (2) a rate that the Secretary determines will— (A) minimize potential loan forfeitures; (B) minimize the accumulation of stocks of the commodity by the Federal Govern- ment; (C) minimize the cost incurred by the Fed- eral Government in storing the commodity; and (D) allow the commodity produced in the United States to be marketed freely and competitively, both domestically and inter- nationally. (b) Repayment rates for upland cotton and rice The Secretary shall permit producers to repay a marketing assistance loan under section 7231 of this title for upland cotton and rice at a rate that is the lesser of— (1) the loan rate established for the com- modity under section 7232 of this title, plus in- terest (as determined by the Secretary); or (2) the prevailing world market price for the commodity (adjusted to United States quality and location), as determined by the Secretary. (c) Repayment rates for extra long staple cotton Repayment of a marketing assistance loan for extra long staple cotton shall be at the loan rate established for the commodity under section 7232 of this title, plus interest (as determined by the Secretary). (d) Prevailing world market price For purposes of this section and section 7236 of this title, the Secretary shall prescribe by regu- lation— (1) a formula to determine the prevailing world market price for each loan commodity, adjusted to United States quality and loca- tion; and (2) a mechanism by which the Secretary shall announce periodically the prevailing world market price for each loan commodity. (e) Adjustment of prevailing world market price for upland cotton (1) In general During the period ending July 31, 2003, the prevailing world market price for upland cot-