Handling 2007-Crop Peanut Storage and In-Handling

1. Handling 2007-Crop Peanut Storage and In-Handling July 2007

2. BACKGROUND • The Farm Security and Rural Investment Act of 2002 (2002 Act), required CCC to pay storage, handling, and other associated costs for all peanuts placed in the MAL program through the 2006 crop year. • This mandate was terminated with the 2007 crop year.

3. BACKGROUND (CONTINUED) • Based on the termination of this policy, FSA has approved procedures and the method for collecting storage and in-handling from producers who place their peanuts in the MAL program.

4. 2007 STORAGE AND IN-HANDLING POLICY • FSA will allow offsets for: • Peanut Storage • In-handling

5. 2007 STORAGE AND IN-HANDLING POLICY • For storage and/or in-handling to be offset the producer must: • Present a bill or a statement of unpaid charges with the warehouse receipt when requesting a marketing assistance loan (MAL). • Complete a CCC-679. (similar to cleaning/drying)

6. 2007 STORAGE AND IN-HANDLING POLICY • Storage and/or In-handling will: • be deducted from the MAL proceeds as directed by each producer. • NOT be considered a LIEN. Note: Storage charges can be offset only if the warehouse receipt indicates storage has been paid or provided for, as applicable.

7. 2007 STORAGE POLICY • Warehouse-Stored MAL Peanuts Options • If the warehousereceipt is issued by the warehouse indicating that the storage charges HAVE BEEN paid through or provided for through loan maturity then: • FSA will not reduce the loan rate. • at the time the MAL is repaid, FSA will use the normal repayment process.

8. 2007 STORAGE POLICY • If the warehouse receipt is issued by the warehouse indicating that storage charges have NOT BEEN or PARTIALLYpaid through or provided for through loan maturity then CCC will:

9. 2007 STORAGE POLICY • reduce the loan rate by the amount of unpaid storage charges through loan maturity. To establish the amount of unpaid storage FSA will use the “Date Storage Paid Through” to determine if it is earlier than the loan maturity date, thus calculating the number of month/days of unpaid storage from the day after “Date Storage Paid Through” to loan maturity. (Note: If “Date Storage Paid Through” is not provided, then the number of days of unpaid storage charges will be calculated from the “Date Documents Received” through loan maturity.)

10. 2007 STORAGE POLICY • before loan repayment, if the MAL was REDUCED, FSA will allow the producer/agent to provide proof that warehouse storage charges have been paid or provided for during the period for which the storage was previously deducted. Accordingly, the dates and the loan amount will be adjusted to reflect the deducted storage amount and the MAL will be adjusted to account for an additional cash disbursement.

11. 2007 STORAGE POLICY ATFORFEITURE • If the MAL is not repaid within the 9 month period and the peanuts are subsequently forfeited to CCC, storage charges will be handled as follows, if charges were: • paid through maturity, then CCC will pay storage charges to the warehouse starting the day after loan maturity through final disposition.

12. 2007 STORAGE POLICYATFORFEITURE • not fully paid and the loan rate is reduced by FSA, then CCC will pay storage charges to the warehouse from the later of the “Date Storage Paid Through” or the “Date Documents Received” through final disposition, when applicable. • paid beyond maturity, then CCC will refund to the producer all storage charges paid

13. 2007 STORAGE POLICYATFORFEITURE NOTE: • If the peanuts are forfeited to CCC then: • CCC will pay the warehouse from Storage Start through final disposition and the producer will be billed by FSA for the period cover the Storage Start to Date Documents Received.

14. Questions • Questions concerning this policy contact: Tonye Gross Peanut Program Manager Farm Service Agency Price Support Division (202) 720-4319 (202) 690-1536 Tonye.Gross@wdc.usda.gov