NEW LOANS FOR ON-FARM STORAGE

The United States Department of Agriculture will revise a program from the early 1980s to provide low-cost loans to farmers to help build or upgrade commodity storage and handling facilities on the farm.

Dan Glickman, USDA secretary announced the latest loan program Thursday.

A lot of farmers already have some on-farm storage facilities, said Terry Birk, of the USDA Farm Service Agency office in Jackson. "We had a similar program that ended in 1982."

"Several area farmers constructed storage facilities before 1982," said Birk. "Some farmers have added to their facility through the years."

Birk said some interest in on-farm storage had been expressed recently, and the USDA thought it was a good idea to revise the program. On-farm storage gives farmers the control they need to segregate their crops and decide when to sell them, say Glickman and Birk. "It gives them more marketing flexibility."

The USDA's Farm Service Agency will implement the program to provide seven-year financing for on-farm grain storage.

The interest rate charged will be the same as the rate charged on comparable Treasury securities in effect during the month the loan is approved. The rate will remain in effect for the term of the loan.

Farmers may file loan applications starting May 30, 2000. Farmers who bought or built storage facilities between February 2 and May 30 this year may apply for a loan and may be approved if they meet eligibility and loan security requirements.

USDA will publish the draft regulations for this program in the Federal Register this week. A 30 day comment period will follow. A final rule will be published and codified after comments have been considered on the Farm Storage Facility Loan Program and USDA financing for storage structures for commodities other than grain, such as silage; alternative types of storage, such as "condominium storage;" and storage facilities for other agriculture products.