LDPs are currently working for corn and soybeans produced in 2006. Today, there is a three-cent LDP on corn and a 12 cent LDP on soybeans.
The CCC-633EZ (page 1) form is used to indicate your intention to receive loan deficiency payments for all your crops at the beginning of the crop year. Remember, we've switched to the CCC-633EZ form and the CCC-709 is obsolete.
Provisions of CCC-633 EZ (page 1)
You will receive benefits based on the earlier of:
- The date beneficial interest is lost in the commodity (sold, fed, etc.)
- The date you request LDP payment
If you wish to receive the LDP on your grain the date you dump the grain versus the date beneficial interest is lost in the commodity, you will need to file a CCC-633 EZ (page 2) prior to harvest.
Page 1 only needs to be completed once per crop year and covers all eligible commodities in all counties designated. It does not negate your eligibility for commodity loans or your ability to use the eLDP online process.
The CCC-633 EZ has been designed to simplify the LDP process and allows producers to indicate intentions to receive an LDP before loss of beneficial interest and allows producers to submit an LDP request for benefits at any time during the loan/LDP availability period.
Most producers in Clay County signed the CCC-633 (page 1) while they were in our office to sign up for the 2006 the Direct and Counter-Cyclical Program (DCP) payment or at acreage reporting time.
Requesting an LDP Payment
(CCC-633EZ, Page 2)
To receive LDP benefits a CCC-633EZ, (page 2) must be submitted after harvest but before the final loan availability date (May 31 for corn and soybeans). LDP benefits are calculated as follows:
1. If beneficial interest has been lost on the grain (example at harvest) then applicable settlement evidence must be submitted to the office and the LDP rate will be paid based on the date beneficial interest was lost. All requests for an LDP must be accompanied by a CCC-633 EZ (page 2). Therefore, if you submit an assembling sheet from the elevator, the office will need to receive the CCC-633 (page 2) prior to issuing the LDP.
2. If the commodity is STORED on the farm or at the elevator and beneficial interest has NOT been lost, the LDP payment will be based on the date page 2 is received in the office.
3. Producers who deliver to a CCC approved warehouse and place the commodity in open storage for a term of 30 days or more will lose beneficial interest in the commodity on the 31st calendar day unless an approved warehouse receipt can be issued to the producer.
2006 Commodity Loans
CCC Marketing Loans are available to producers who wish to pledge their 2006 crops as collateral. The 2006 Crop Loan rates for Clay County are: Corn, $1.84; Soybeans, $4.93; Spring Wheat, $2.69; Winter Wheat, $2.72 Oats, $1.33; Wool, $.40/lb.
Producers are required to have "beneficial interest" in a commodity to pledge it as collateral for a CCC loan. Loans mature (become due) the last day of the ninth month after the month in which disbursed. Loans accrue interest at a comparatively low interest rate. The interest rate for August 2006 marketing loans is 6.25 percent.
A marketing loan can be settled one of three ways:
- Repay principal plus interest
- Repay at posted county price (CCC determined value)
- Deliver commodity to CCC at maturity
Loan collateral may be stored either on the farm or in the warehouse. Producers storing loans on the farm may certify the quantity, provide measurements to the office, or pay the office for measurement service. Producers who will store collateral in a warehouse must submit a negotiable warehouse receipt and pay storage through loan maturity.
Producers should contact the office at least a week prior to requesting a loan. Lien searches must be done, and lien waivers mailed and returned. This also gives the office an opportunity to set up an appointment so you can be served timely during this busy season.