[Code of Federal Regulations]
[Title 7, Volume 10]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1421.110]

[Page 445-446]
 
                          TITLE 7--AGRICULTURE
 
  CHAPTER XIV--COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE
 
PART 1421_GRAINS AND SIMILARLY HANDLED COMMODITIES_MARKETING ASSISTANCE LOANS 
 
                  Subpart B_Marketing Assistance Loans
 
Sec.  1421.110  Repayments.

    (a) CCC may allow a producer to repay a nonrecourse marketing 
assistance loan at a rate that is the lesser of:
    (1) The loan rate and charges, plus interest determined for a crop; 
or
    (2) The prevailing world market price, as determined by CCC, for 
rice or the alternative repayment rate for all other commodities, as 
determined by CCC.
    (b)(1) On a form prescribed by CCC, a producer may request to lock 
in the applicable repayment rate for a period of:
    (i) 60 calendar days; or
    (ii) not less than 14 calendar days before the maturity date of the 
loan, but not both.
    (2) The request to lock in the applicable repayment rate must be 
received in the FSA county service center that disbursed the loan.
    (3) The repayment rate that is locked in is the rate in effect when 
the request to lock in is approved.
    (4) The repayment rate may be locked in on outstanding farm-stored 
or warehouse-stored loans.
    (5) The repayment rate that is locked in will expire the earlier of:
    (i) 60 calendar days from date of approval, or;
    (ii) 14 calendar days before loan maturity.
    (6) The requests can only be completed one time for a designated 
quantity.
    (7) The requests can be made in person or by facsimile.
    (8) The requests cannot be canceled, terminated, or changed after 
approval.
    (9) The locked-in applicable repayment rate will not transfer to any 
loan disbursed outside of the originating county where the commodity was 
stored.
    (10) Once a repayment rate is locked in it cannot be extended.
    (c) If a producer fails to repay a marketing assistance loan within 
the time prescribed by CCC under the terms and conditions of the request 
to lock in a market loan repayment rate, the producer may repay the 
loan:
    (1) On or before maturity, at the lesser of:
    (i) Principal plus interest as determined by CCC;
    (ii) The repayment rate in effect on the day the repayment is 
received in the FSA county service center.
    (2) After maturity at principal plus interest.
    (d) When the proceeds of the sale of the commodity are needed to 
repay all or a part of a farm-stored loan, the producer must request and 
obtain prior written approval on a CCC approved form and comply with the 
terms and conditions of such form, to remove a specified quantity of the 
commodity from storage. Approval does not constitute release of CCC's 
security interest in the commodity or release of producer liability for 
amounts due CCC for the marketing assistance loan indebtedness if 
payment in full is not received by the county office. Failure to repay a 
marketing assistance loan within the time period prescribed by CCC in 
the case of a farm-stored loan and delivery of the pledged collateral to 
a buyer, is a violation of the agreement. In the case of such violation, 
the producer must repay the loan principal and interest or another 
amount as determined by the Deputy Administrator, FSA, under Sec.  
1421.109.
    (e) The producer may obtain county committee approval of a release 
of all

[[Page 446]]

or part of pledged collateral for a warehouse-stored loan at or before 
the maturity of such loan by paying to CCC:
    (1) The principal amount of the marketing assistance loan and 
charges plus interest, or
    (2) An amount less than the principal amount of the marketing 
assistance loan and charges plus interest under the terms and conditions 
specified by CCC at the time the producer redeems the collateral for 
such loan.
    (f) A partial release of marketing assistance loan collateral must 
cover all of the commodity represented by one warehouse receipt. 
Warehouse receipts redeemed by repayment of the marketing assistance 
loan shall be released only to the producer. However, such receipt may 
be released to persons designated in a written authorization that is 
filed with the county office by the producer within 15 days before the 
date of repayment.
    (g) The note and security agreement shall not be released until the 
marketing assistance loan has been satisfied in full.
    (h)(1) If the commodity is moved from storage without obtaining 
prior approval to move such commodity, such removal shall constitute 
unauthorized removal or disposition, as applicable under Sec.  
1421.109(b), unless the removal occurred on a non-workday and the 
producer notified the county office on the next workday of such removal.
    (2) Any loan quantities involved in a violation of Sec.  1421.109 
must be repaid under Sec.  1421.109(e).