Wool Growers Should Monitor Marketing Assistance Loan & LDP Rates
Rates for ungraded, grease wool changed dramatically this week, leading to the availability of a .30 cent per pound benefit. Rates are also favorable in some fine wool ranges, as well as for the coarsest of American wools. The American Sheep Industry Association has been working with the U.S. Department of Agriculture to see that rates adequately reflect the current wool market. That interaction – along with increased wool price reporting – has led to the most updated rate changes in years.
There is also and unshorn pelt LDP payment, which is 6.865 lbs. multiplied by the LDP rate (.30 cents) and comes out to $2.0595 per head this week.
Additional changes are expected in the weeks and months to come, so the program is more reflective of the current market. Rates change each Tuesday and can be found on the ASI website, along with a link to FSA Fact Sheet at sheepusa.org/issues-governmentprograms-woolldp.
For those growers interested in a loan, the Market Assistance Loan program is available for up to a 12-month loan. The other available program is the Commodity Certificate Exchange. More information on all these programs can be found on the FSA Fact Sheet www.fsa.usda.gov/Assets/USDA-FSA-Public/usdafiles/FactSheets/2016/mal_ldp_2016.pdf.
The Farm Security and Rural Investment Act of 2002 provides 2020 crop year marketing assistance loans and loan deficiency payments for wool and mohair to eligible producers who produce and shear wool and mohair from live sheep and goats. The LDP program is also available to eligible producers of non-graded wool in the form of unshorn pelts for the 2020 crop years. The wool and mohair non-recourse marketing assistance loan and LDP program provides eligible producers with two forms of federal assistance. Eligible producers can either: 1. request a 12-month marketing assistance loan; or 2. agree to forgo the loan and request an LDP. The program helps stabilize America’s wool industry and ensures the well-being of agriculture in the United States.
ASI Deputy Director Rita Samuelson reminds producers that this program is designed to step in during market crashes and encourages those that haven’t sold the 2020 clip to go into their local FSA office and complete forms to prepare for the date they want to apply for LDP. This is also a good time to ask about program updates and specifics.