WASHINGTON, D.C. – U.S. Sen. Thad Cochran (R-Miss.), ranking member of the Senate Agriculture, Nutrition and Forestry Committee, and U.S. Sen. Roger Wicker (R-Miss.) have challenged the U.S. Department of Agriculture to explain what they call recent ill-timed decisions regarding marketing assistance loans that are creating financial uncertainty and hardships for farmers and businesses, including what will amount to a one-month delay in processing loans.
Cochran, along with 13 other senators, wrote a letter to Agriculture Secretary Tom Vilsack that requests explanations for the Sept. 30 decision to apply a 5.1 percent sequester on marketing assistance loans made after Oct. 1, which could result in price reductions for peanut and cotton yields. The letter also asks the USDA to explain the rationale behind the timing of the loan processing delay.
“Marketing assistance loans represent a financial tool used by our peanut and cotton producers to market their crops and maintain stable farm operations. Secretary Vilsack should explain why it USDA has disrupted the use of these assets during harvest season and, ideally, take corrective actions,” said Cochran, who spearheaded the letter.
“Changing the rules in the middle of the game is unfair to our nation’s food producers, particularly during harvest season,” Wicker said.
The 14-day loan processing delay to allow for software updates was scheduled to begin Oct. 1 but was further delayed during the 16-day partial government shutdown. The USDA indicated during the shutdown that the 14-day software upgrade would commence when the government reopened.
“The decision to apply sequestration and delay loan processing just as harvest across much of the Sunbelt is gearing up is particularly damaging because it was made without warning,” the senators wrote. “This means growers, marketing cooperatives, private merchandizing firms, and agribusinesses were unable to make alternative plans to mitigate the financial hardship imposed by the decisions.
“We call to your attention our constituents’ concerns about the lack of details and transparency in the USDA’s last-minute announcement. Most notable is the fact that the news release did not specify whether loan redemptions would also be impacted by sequestration. This will have a direct bearing on how growers, marketing cooperatives, private merchandizing firms, and agribusinesses adjust their current and future marketing strategy.”
In addition to Cochran and Wicker, the letter was signed by Senators Saxby Chambliss (R-Ga.), ranking member on the Agriculture Subcommittee on Commodities, Markets, Trade and Risk Management, John Boozman (R-Ark.), Richard Burr (R-N.C.), John Cornyn (R-Texas), Lindsey Graham (R-S.C.), Kay Hagan (D-N.C.), James Inhofe (R-Okla.), Johnny Isakson (R-Ga.), Mary Landrieu (D-La.), Mark Pryor (D-Ark.), Richard Shelby (R-Ala.) and David Vitter (R-La.).