USDA Update

By Rod Johnson

May 7, 2004

A letter will be mailed directly from Kansas City informing producers of their options if a refund of counter-cyclical payments is required due to increased market prices. Very few producers in Kiowa County received advance counter-cyclical payments so refunds, if required, will be minimal. We believe this letter will only be mailed to those producers who actually received advance counter-cyclical payments. This letter does not apply to direct payments under the Direct & Counter-Cyclical Program. Most producers in Kiowa County have received direct payments. Direct payments are guaranteed while counter-cyclical payments are computed based on market prices of crops. Market prices of crops have increased in recent months and there is a possibility that all or a portion of counter-cyclical payments already issued may need to be refunded. The letter will describe producer’s options in these situations.

Hopefully it will keep raining and we will not have to deal with prevented planting due to drought in 2004. This is always a complicated issue for both the County Committee and producers. To be eligible a producer must file a prevented planting claim within 15 days after the final planting date for the crop. When an application is filed other information such as land preparation, arrangements for seed and fertilizer and other information about the disaster must be provided for the County Committee review. Prevented planting must be due to a natural disaster and not just a management decision not to plant.

Several USDA Rural Development Offices will be changing counties they service. Kiowa County will be serviced out of the new office at the USDA Service Center in Las Animas, phone number 719-456-0120. Rural Development works primarily with housing, business and community type loans.

The interest rate for commodity loans disbursed in May is 2.250 percent per annum. The interest rate for Farm Storage Facility Loans approved in May is 3.626