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WASHINGTON, Dec. 9, 2003 - The U.S. Department of Agriculture today announced the 2004 national and county loan rates for wheat, barley, oats and other oilseeds, as authorized by the 2002 Farm Bill. This is the earliest ever that USDA has announced the marketing assistance loan rates for these commodities.

After enactment of the 2002 Farm Bill, USDA announced the most comprehensive adjustments in more than 15 years to the county loan rate structure for 2002 crops. Because adjustments in county loan rates had not been made for grains for several years, numerous disparities between loan rates and market prices had emerged, affecting producer benefits. The restructured rates were intended to more clearly reflect market factors affecting each crop and minimizing distortions that work to the detriment of producers and industry.

The 2004 county loan rates announced today continue this market-oriented approach. The relative levels of the county loan rates for each commodity reflect the most recent information available about price relationships around the country and will enhance the market orientation of the wheat, barley, oats, and other oilseed loan and loan deficiency payment (LDP) program.

2004 National Loan Rate Changes Mandated by Law The 2002 Farm Bill established specific national loan rates for each commodity, with one level set for the 2002 and 2003 crops and somewhat lower levels for the 2004-2007 crops, as shown in the following table. These changes are reflected in the county loan rates announced today.

Commodity Crop Year Change--2004 Relative to 2003
2002-2003 2004-2007

Wheat ($/Bu) $2.80 $2.75 -$0.05
Barley ($/Bu) $1.88 $1.85 -$0.03
Oats ($/Bu) $1.35 $1.33 -$0.02
Each "Other Oilseed" ($/Cwt) $9.60 $9.30 -$0.30

Despite these statutorily mandated changes, 2004 national loan rates for wheat, barley and oats are still higher than their pre-2002 Farm Bill (2001-crop) levels, and those for other oilseeds are the same or higher than their respective pre-2002 Farm Bill (2001-crop) levels.

Wheat by Class Rates and Differentiation for Durum Loan Rates Continued
The 2004 county loan rates for wheat have been updated and remain differentiated by each of the five major classes of wheat (durum, hard red spring, hard red winter, soft red winter and soft white), continuing the precedent established with the 2002 rates. The varying supplies and changing demand patterns of these different wheat classes produce widely variable market prices. By moving to the class-based system for wheat, the Commodity Credit Corporation (CCC) now provides marketing assistance loans and LDPs reflecting actual market prices for each class, thus achieving a more equitable distribution of commodity program benefits among producers.

Loan rate premiums will again be available for all durum wheat that grades as amber durum or hard amber durum. This policy was established in 2003 to further improve the market orientation of the wheat loan program.

Beginning with the 2003 crop, the base level of the alternative loan repayment rate (or "posted county price" [PCP] as it is typically known) was announced daily for durum with corresponding premiums for durum, which grades as either amber durum or hard amber durum. The 2004 per-bushel premiums applied to the base level of the durum county loan rate will continue at 2003-crop levels:

Amber durum $0.20
Hard amber durum $0.30
Barley, Oats, and Other Oilseed Loan Rates Updated
The CCC has updated the county loan rates for barley, oats and other oilseeds to reflect recent market price relationships among counties. This continues the policy initiated with the 2002 crop to increase the market orientation of the loan and LDP program by making county loan rates for these crops reflect recent county-to-county market price relationships. In establishing this year's rates, the CCC continued to give special attention to reducing loan rate differences among neighboring counties that were not justified by current market forces.

Other 2004 Crops
The 2004-crop loan rates for corn, grain sorghum, soybeans and pulses will be announced early next year, thereby enabling producers to better utilize this information in their planting and marketing decisions.
MGR Archive 10.12.2003
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Region Type Price  
Russia Rapan $ 700
USA Jupiter Rice $630
USA Calrose #1 $830
USA Calrose #1 Paddy $480
EU Prices Baldo €660
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