The U.S. Department of Agriculture announced loan interest rates for January 2022, which are effective Jan. 3. USDA’s Farm Service Agency loans provide important access to capital to help agricultural producers start or expand their farming operation, purchase equipment, and storage structures, or meet cash flow needs.
Operating, Ownership, and Emergency Loans
FSA offers farm ownership and operating loans with favorable interest rates and terms to help eligible agricultural producers, whether multi-generational, long-time or new to the industry, obtain financing needed to start, expand or maintain a family agricultural operation. FSA also offers emergency loans to help producers recover from production and physical losses due to drought, flooding, other natural disasters or quarantine. For many loan options, FSA sets aside funding for historically underserved producers, including veterans, beginning, women, American Indian or Alaskan Native, Asian, Black or African American, Native Hawaiian or Pacific Islander, and Hispanic farmers and ranchers.
Interest rates for Operating and Ownership loans for January 2022 are as follows:
- Farm Operating Loans (Direct): 2.125%
- Farm Ownership Loans (Direct): 3.000%
- Farm Ownership Loans (Direct, Joint Financing): 2.500%
- Farm Ownership Loans (Down Payment): 1.500%
- Emergency Loan (Amount of Actual Loss): 3.125%
FSA also offers guaranteed loans through commercial lenders at rates set by those lenders.
You can find out which of these loans may be right for you by using our Farm Loan Discovery Tool.
Commodity and Storage Facility Loans
Additionally, FSA provides low-interest financing to producers to build or upgrade on-farm storage facilities and purchase handling equipment and loans that provide interim financing to help producers meet cash flow needs without having to sell their commodities when market prices are low. Funds for these loans are provided through the Commodity Credit Corporation (CCC) and are administered by FSA.
- Commodity Loans (less than one year disbursed): 1.250%
- Farm Storage Facility Loans:
- Three-year loan terms: 0.875%
- Five-year loan terms: 1.250%
- Seven-year loan terms: 1.375%
- Ten-year loan terms: 1.500%
- Twelve-year loan terms: 1.625%
- Sugar Storage Facility Loans (15 years): 1.750%
Pandemic and Disaster Support
Due to recent outbreaks of the COVID-19 Delta variant, USDA has extended the deadline for producers to apply for the COVID-19 Disaster Set-Aside (DSA) loan provision to Jan. 31, 2022. FSA will permit a second DSA for COVID-19 and a second DSA for natural disasters for those who had an initial COVID-19 DSA. Requests for a second DSA must be received no later than May 1, 2022.
Last year, FSA broadened the use of the DSA, normally used in the wake of natural disasters, to allow farmers with USDA farm loans who are affected by COVID-19 and are determined eligible, to have their next payment set aside. The set-aside payment’s due date is moved to the final maturity date of the loan or extended up to 12 months in the case of an annual operating loan. Any principal set aside will continue to accrue interest until it is repaid. This will improve the borrower’s cash flow in the current production cycle.
FSA also reminds rural communities, farmers and ranchers, families, and small businesses affected by the year’s winter storms, drought, hurricanes, and other natural disasters that USDA has programs that provide assistance. USDA staff in the regional, state, and county offices are prepared to deliver a variety of program flexibilities and other assistance to agricultural producers and impacted communities. Many programs are available without an official disaster designation, including several risk management and disaster recovery options.