The budget patch gives the Agriculture Department’s Farm Service Agency authority to meet the spike in loan demand by using future funding, according to U.S. Sen. Jerry Moran, a Kansas Republican who chairs an agricultural appropriations panel. There is no limit to how much the USDA can lend through April 28 – a victory for farm groups who pressed Washington for the fix to avert a looming loan crisis.
Already, corn and wheat prices have pushed farmers to the limit, and beef prices are hurting ranchers. They turned to lenders, leading the FSA to fall short $137 million short of needed direct and guaranteed loan funds in the fiscal year ending Sept. 30.
When the money ran out, approved loans were funded in the current fiscal year, piling on to the demand for loans and raising the specter that FSA would again run out of money before spring – when most farmers need it the most.
“If you are trying to grow a crop and feed a family and pay the bills, it is a problem,” Moran said. “This is one of the most difficult times in agriculture in a long time.”
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