Pro Farmer Editors
Commodity Credit Corporation (CCC) today announced interest rates for April 2009. The CCC borrowing rate-based charge is 0.625 percent, up from 0.500 in March 2009. For 1996 and subsequent crop year commodity and marketing assistance loans, the interest rate for loans disbursed during April 2009 is 1.625 percent, up from 1.500 in March 2009.
The interest rate for Farm Storage Facility Loans approved for April 2009 is 2.500 percent, up from 2.250 percent in March 2009. The interest rate for Sugar Storage Facility Loans for April 2009 is 3.750 percent, unchanged from March 2009.
The maximum discount rate applicable for April 2009 for the Tobacco Transition Payment Program is 5 percent, unchanged from March 2009. This is based on the 3.250 percent prime rate plus 2 percent, rounded to the nearest whole number.
Past monthly releases announcing interest rates charged by CCC on commodity and marketing assistance loans disbursed for that particular month reflect the interest rate the U.S. Treasury charged CCC for that month. This was the interest rate specified by CCC since Jan. 1, 1982, but the process of establishing the interest rate was changed by a provision of the Federal Agriculture Improvement and Reform Act of 1996 (the Act), enacted on April 4, 1996.
Section 163 of the Act requires that monthly interest rates applicable to commodity and marketing assistance loans are to be 100 basis points - or 1 percent - greater than the rate determined under the applicable interest rate formula in effect on Oct. 1, 1995. This formula resulted in a rate equivalent to the amount the U.S. Treasury charged CCC for borrowing, for the month.