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§ 9034. Repayment of loans

Official text

Section titled “Official text”
§ 9034.

Repayment of loans

(a)

General rule

The Secretary shall permit the producers on a farm to repay a marketing assistance loan under section 9031 of this title for a loan commodity (other than upland cotton, long grain rice, medium grain rice, extra long staple cotton, peanuts and confectionery and each other kind of sunflower seed (other than oil sunflower seed)) at a rate that is the lesser of—

(1) the loan rate established for the commodity under section 9032 of this title, plus interest (determined in accordance with section 7283 of this title);
(2)

a rate (as determined by the Secretary) that—

(A) is calculated based on average market prices for the loan commodity during the preceding 30-day period; and
(B) will minimize discrepancies in marketing loan benefits across State boundaries and across county boundaries; or
(3)

a rate that the Secretary may develop using alternative methods for calculating a repayment rate for a loan commodity that the Secretary determines will—

(A) minimize potential loan forfeitures;
(B) minimize the accumulation of stocks of the commodity by the Federal Government;
(C) minimize the cost incurred by the Federal Government in storing the commodity;
(D) allow the commodity produced in the United States to be marketed freely and competitively, both domestically and internationally; and
(E) minimize discrepancies in marketing loan benefits across State boundaries and across county boundaries.
(b)

Repayment rates for upland cotton, long grain rice, and medium grain rice

(1)

In general

The Secretary shall permit producers to repay a marketing assistance loan under section 9031 of this title for upland cotton, long grain rice, and medium grain rice at a rate that is the lesser of—

(A) the loan rate established for the commodity under section 9032 of this title, plus interest (determined in accordance with section 7283 of this title); or
(B)
(i) in the case of long grain rice and medium grain rice, the prevailing world market price for the commodity, as determined and adjusted by the Secretary in accordance with this section; or
(ii) in the case of upland cotton, the prevailing world market price for the commodity, as determined and adjusted by the Secretary in accordance with this section.
(2)

Refund for upland cotton

In the case of a repayment for a marketing assistance loan for upland cotton at a rate described in paragraph (1)(B)(ii), the Secretary shall provide to the producer a refund (if any) in an amount equal to the difference between the lowest prevailing world market price, as determined and adjusted by the Secretary in accordance with this section, during the 30-day period following the date on which the producer repays the marketing assistance loan and the repayment rate.
(c)

Repayment rates for extra long staple cotton

Repayment of a marketing assistance loan for extra long staple cotton shall be at a rate that is the lesser of—

(1) the loan rate established for the commodity under section 9032 of this title, plus interest (determined in accordance with section 7283 of this title); and
(2) the prevailing world market price for the commodity, as determined and adjusted by the Secretary in accordance with this section.
(d)

Prevailing world market price

(1)

In general

For purposes of this section and section 9037 of this title, the Secretary shall prescribe by regulation—

(A) a formula to determine the prevailing world market price for each of upland cotton, long grain rice, medium grain rice, and extra long staple cotton; and
(B) a mechanism by which the Secretary shall announce periodically those prevailing world market prices.
(2)

Upland cotton

In the case of upland cotton, for any period when price quotations for Middling (M) 13⁄32-inch cotton are available, the formula under paragraph (1)(A) shall be based on the average of the 3 lowest-priced growths that are quoted.
(e)

Adjustment of prevailing world market price for upland cotton, extra long staple cotton, long grain rice, and medium grain rice

(1)

Rice

The prevailing world market price for long grain rice and medium grain rice determined under subsection (d) shall be adjusted to United States quality and location.
(2)

Upland cotton

The prevailing world market price for upland cotton determined under subsection (d)—

(A)

shall be adjusted to United States quality and location, with the adjustment to include—

(i) a reduction equal to any United States Premium Factor for upland cotton of a quality higher than Middling (M) 13⁄32-inch; and
(ii) the average costs to market the commodity, including average transportation costs, as determined by the Secretary; and
(B)

may be further adjusted, during the period beginning on , and ending on , if the Secretary determines the adjustment is necessary—

(i) to minimize potential loan forfeitures;
(ii) to minimize the accumulation of stocks of upland cotton by the Federal Government;
(iii) to ensure that upland cotton produced in the United States can be marketed freely and competitively, both domestically and internationally; and
(iv)

to ensure an appropriate transition between current-crop and forward-crop price quotations, except that the Secretary may use forward-crop price quotations prior to July 31 of a marketing year only if—

(I) there are insufficient current-crop price quotations; and
(II) the forward-crop price quotation is the lowest such quotation available.
(3)

Extra long staple cotton

The prevailing world market price for extra long staple cotton determined under subsection (d)—

(A) shall be adjusted to United States quality and location, with the adjustment to include the average costs to market the commodity, including average transportation costs, as determined by the Secretary; and
(B)

may be further adjusted, during the period beginning on , and ending on , if the Secretary determines the adjustment is necessary—

(i) to minimize potential loan forfeitures;
(ii) to minimize the accumulation of stocks of extra long staple cotton by the Federal Government;
(iii) to ensure that extra long staple cotton produced in the United States can be marketed freely and competitively; and
(iv)

to ensure an appropriate transition between current-crop and forward-crop price quotations, except that the Secretary may use forward-crop price quotations prior to July 31 of a marketing year only if—

(I) there are insufficient current-crop price quotations; and
(II) the forward-crop price quotation is the lowest such quotation available.
(4)

Guidelines for additional adjustments

In making adjustments under this subsection, the Secretary shall establish a mechanism for determining and announcing the adjustments in order to avoid undue disruption in the United States market.
(f)

Repayment rates for confectionery and other kinds of sunflower seeds

The Secretary shall permit the producers on a farm to repay a marketing assistance loan under section 9031 of this title for confectionery and each other kind of sunflower seed (other than oil sunflower seed) at a rate that is the lesser of—

(1) the loan rate established for the commodity under section 9032 of this title, plus interest (determined in accordance with section 7283 of this title); or
(2) the repayment rate established for oil sunflower seed.
(g)

Payment of cotton storage costs

(1)

Crop years 2014 through 2025

Effective for each of the 2014 through 2025 crop years, the Secretary shall make cotton storage payments available in the same manner, and at the same rates as the Secretary provided storage payments for the 2006 crop of cotton, except that the rates shall be reduced by 10 percent.
(2)

Payment of cotton storage costs

Effective for each of the 2026 through 2031 crop years, the Secretary shall make cotton storage payments for upland cotton and extra long staple cotton available in the same manner as the Secretary provided storage payments for the 2006 crop of upland cotton, except that the payment rate shall be equal to the lesser of—

(A) the submitted storage charge for the current marketing year; and
(B)

in the case of storage in—

(i) California or Arizona, a payment rate of $4.90; and
(ii) any other State, a payment rate of $3.00.
(h)

Repayment rate for peanuts

The Secretary shall permit producers on a farm to repay a marketing assistance loan for peanuts under section 9031 of this title at a rate that is the lesser of—

(1) the loan rate established for peanuts under subsection (a)(20) or (b)(20), as applicable, of section 9032 of this title, plus interest (determined in accordance with section 7283 of this title); or
(2)

a rate that the Secretary determines will—

(A) minimize potential loan forfeitures;
(B) minimize the accumulation of stocks of peanuts by the Federal Government;
(C) minimize the cost incurred by the Federal Government in storing peanuts; and
(D) allow peanuts produced in the United States to be marketed freely and competitively, both domestically and internationally.
(i)

Authority to temporarily adjust repayment rates

(1)

Adjustment authority

In the event of a severe disruption to marketing, transportation, or related infrastructure, the Secretary may modify the repayment rate otherwise applicable under this section for marketing assistance loans under section 9031 of this title for a loan commodity.
(2)

Duration

Any adjustment made under paragraph (1) in the repayment rate for marketing assistance loans for a loan commodity shall be in effect on a short-term and temporary basis, as determined by the Secretary.
(Pub. L. 113–79, title I, § 1204, , 128 Stat. 676; Pub. L. 115–334, title I, §§ 1201(b), 1202(b), , 132 Stat. 4509, 4510; Pub. L. 119–21, title I, §§ 10309(c), 10310, , 139 Stat. 94.)