HR 2419 PCS
(1) REQUIRED REDUCTION.—If the sum of the 
base acres for a farm, together with the acreage de-
scribed in paragraph (2), exceeds the actual crop-
land acreage of the farm, the Secretary shall reduce 
the base acres for 1 or more covered commodities for 
the farm so that the sum of the base acres and acre-
age described in paragraph (2) does not exceed the 
actual cropland acreage of the farm. 
(2) OTHER ACREAGE.—For purposes of para-
graph (1), the Secretary shall include the following: 
(A) Any acreage on the farm enrolled in 
the conservation reserve program or wetlands 
reserve program under chapter 1 of subtitle D 
of title XII of the Food Security Act of 1985 
(16 U.S.C. 3830 et seq.). 
(B) Any other acreage on the farm en-
rolled in a conservation program for which pay-
ments are made in exchange for not producing 
an agricultural commodity on the acreage. 
(3) SELECTION OF ACRES.—The Secretary shall 
give the owner of the farm the opportunity to select 
the base acres against which the reduction required 
by paragraph (1) will be made. 
(4) EXCEPTION FOR DOUBLE-CROPPED ACRE-
AGE.—In applying paragraph (1), the Secretary 
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shall make an exception in the case of double crop-
ping, as determined by the Secretary. 
(c) PERMANENT REDUCTION IN BASE ACRES.— 
(1) IN GENERAL.—The owner of a farm may 
reduce, at any time, the base acres for any covered 
commodity for the farm. 
(2) ADMINISTRATION.—The reduction shall be 
permanent and made in the manner prescribed by 
the Secretary. 
SEC. 1102. AVAILABILITY OF DIRECT PAYMENTS. 
(a) PAYMENT REQUIRED.—For each of the 2008 
through 2012 crop years of each covered commodity, the 
Secretary shall make direct payments to producers on 
farms for which payment yields and base acres are estab-
lished. 
(b) PAYMENT RATE.—The payment rates used to 
make direct payments with respect to covered commodities 
for a crop year are as follows: 
(1) Wheat, $0.52 per bushel. 
(2) Corn, $0.28 per bushel. 
(3) Grain sorghum, $0.35 per bushel. 
(4) Barley, $0.24 per bushel. 
(5) Oats, $0.024 per bushel. 
(6) Upland cotton, $0.0667 per pound. 
(7) Rice, $2.35 per hundredweight. 
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(8) Soybeans, $0.44 per bushel. 
(9) Other oilseeds, $0.0080 per pound. 
(10) Peanuts, $36.00 per ton. 
(c) PAYMENT AMOUNT.—The amount of the direct 
payment to be paid to the producers on a farm for a cov-
ered commodity for a crop year shall be equal to the prod-
uct of the following: 
(1) The payment rate specified in subsection 
(b). 
(2) The payment acres of the covered com-
modity on the farm. 
(3) The payment yield for the covered com-
modity for the farm. 
(d) TIME FOR PAYMENT.— 
(1) IN GENERAL.—In the case of each of the 
2008 through 2012 crop years, the Secretary may 
not make direct payments before October 1 of the 
calendar year in which the crop of the covered com-
modity is harvested. 
(2) ADVANCE PAYMENTS.— 
(A) OPTION.—At the option of the pro-
ducers on a farm, up to 22 percent of the direct 
payment for a covered commodity for any of the 
2008 through 2011 crop years shall be paid to 
the producers in advance. 
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(B) MONTH.— 
(i) SELECTION.—The producers shall 
select the month within which the advance 
payment for a crop year will be made. 
(ii) OPTIONS.—The month selected 
may be any month during the period be-
ginning on December 1 of the calendar 
year before the calendar year in which the 
crop of the covered commodity is harvested 
through the month within which the direct 
payment would otherwise be made. 
(iii) CHANGE.—The producers may 
change the selected month for a subse-
quent advance payment by providing ad-
vance notice to the Secretary. 
(3) REPAYMENT OF ADVANCE PAYMENTS.—If a 
producer on a farm that receives an advance direct 
payment for a crop year ceases to be a producer on 
that farm, or the extent to which the producer 
shares in the risk of producing a crop changes, be-
fore the date the remainder of the direct payment is 
made, the producer shall be responsible for repaying 
the Secretary the applicable amount of the advance 
payment, as determined by the Secretary. 
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(e) PROHIBITION ON DE MINIMIS PAYMENTS.—If 
the total direct payment to be paid to a producer on a 
farm for all covered commodities is less than $25.00, the 
Secretary shall not tender the direct payment to the pro-
ducer. 
SEC. 1103. AVAILABILITY OF COUNTER-CYCLICAL PAY-
MENTS. 
(a) PAYMENT REQUIRED.—For each of the 2008 
through 2012 crop years for each covered commodity, the 
Secretary shall make counter-cyclical payments to pro-
ducers on farms for which payment yields and base acres 
are established with respect to the covered commodity if 
the Secretary determines that the effective price for the 
covered commodity is less than the target price for the 
covered commodity. 
(b) EFFECTIVE PRICE.—For purposes of subsection 
(a), the effective price for a covered commodity is equal 
to the sum of the following: 
(1) The higher of the following: 
(A) The national average market price re-
ceived by producers during the 12-month mar-
keting year for the covered commodity, as de-
termined by the Secretary. 
(B) The national average loan rate for a 
marketing assistance loan for the covered com-
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modity in effect for the applicable period under 
subtitle B, except that, for the purpose of calcu-
lating counter-cyclical payments under this sec-
tion for rice and barley, the Secretary shall es-
tablish national average all rice and all barley 
loan rates. 
(2) The payment rate in effect for the covered 
commodity under section 1102 for the purpose of 
making direct payments with respect to the covered 
commodity. 
(c) TARGET PRICE.—For purposes of subsection (a), 
the target prices for covered commodities shall be as fol-
lows: 
(1) Wheat, $4.15 per bushel. 
(2) Corn, $2.63 per bushel. 
(3) Grain sorghum, $2.57 per bushel. 
(4) Barley, $2.73 per bushel. 
(5) Oats, $1.50 per bushel. 
(6) Upland cotton, $0.70 per pound. 
(7) Rice, $10.50 per hundredweight. 
(8) Soybeans, $6.10 per bushel. 
(9) Other oilseeds, $0.1150 per pound. 
(10) Peanuts, $495.00 per ton. 
(d) PAYMENT RATE.—The payment rate used to 
make counter-cyclical payments with respect to a covered 
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commodity for a crop year shall be equal to the difference 
between— 
(1) the target price for the covered commodity; 
and 
(2) the effective price determined under sub-
section (b) for the covered commodity. 
(e) PAYMENT AMOUNT.—If counter-cyclical pay-
ments are required to be paid under this section for any 
of the 2008 through 2012 crop years of a covered com-
modity, the amount of the counter-cyclical payment to be 
paid to the producers on a farm for that crop year shall 
be equal to the product of the following: 
(1) The payment rate specified in subsection 
(d). 
(2) The payment acres of the covered com-
modity on the farm. 
(3) The payment yield for the covered com-
modity for the farm. 
(f) TIME FOR PAYMENTS.— 
(1) GENERAL RULE.—If the Secretary deter-
mines under subsection (a) that counter-cyclical pay-
ments are required to be made under this section for 
the crop of a covered commodity, the Secretary shall 
make the counter-cyclical payments for the crop as 
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soon as practicable after the end of the 12-month 
marketing year for the covered commodity. 
(2) AVAILABILITY OF PARTIAL PAYMENTS.—If, 
before the end of the 12-month marketing year for 
a covered commodity, the Secretary estimates that 
counter-cyclical payments will be required for the 
crop of the covered commodity, the Secretary shall 
give producers on a farm the option to receive par-
tial payments of the counter-cyclical payment pro-
jected to be made for that crop of the covered com-
modity. 
(3) TIME
FOR
PARTIAL
PAYMENTS
FOR
2008 
THROUGH 2010 CROP YEARS.—If the Secretary is re-
quired to make partial payments available under 
paragraph (2) for a covered commodity for any of 
the 2008 through 2010 crop years— 
(A) the first partial payment shall be made 
after completion of the first 6 months of the 
marketing year for the covered commodity; and 
(B) the final partial payment shall be 
made the later of the following: 
(i) As soon as practicable after the 
end of the 12-month marketing year for 
the covered commodity. 
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(ii) October 1 of the fiscal year start-
ing in the same calendar year as the end 
of the marketing year. 
(4) AMOUNT OF PARTIAL PAYMENTS.— 
(A) FIRST PARTIAL PAYMENT.—For each 
of the 2008 through 2010 crop years, the first 
partial payment under paragraph (3) to the 
producers on a farm may not exceed 40 percent 
of the projected counter-cyclical payment for 
the covered commodity for the crop year, as de-
termined by the Secretary. 
(B) FINAL PAYMENT.—The final payment 
for each of the 2008 through 2010 crop years 
shall be equal to the difference between— 
(i) the actual counter-cyclical payment 
to be made to the producers for the cov-
ered commodity for that crop year; and 
(ii) the amount of the partial payment 
made to the producers under subparagraph 
(A). 
(5) REPAYMENT.—The producers on a farm 
that receive a partial payment under this subsection 
for a crop year shall repay to the Secretary the 
amount, if any, by which the total of the partial pay-
ments exceed the actual counter-cyclical payment to 
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be made for the covered commodity for that crop 
year. 
(g) PROHIBITION ON DE MINIMIS PAYMENTS.—If 
the total counter-cyclical payment to be paid to a producer 
on a farm for all covered commodities is less than $25.00, 
the Secretary shall not tender the counter-cyclical pay-
ment to the producer. 
SEC. 1104. AVAILABILITY OF REVENUE-BASED COUNTER- 
CYCLICAL PAYMENTS. 
(a) AVAILABILITY AND ELECTION OF ALTERNATIVE 
APPROACH.— 
(1) 
AVAILABILITY
OF
REVENUE-BASED 
COUNTER-CYCLICAL PAYMENTS.—As an alternative 
to receiving counter-cyclical payments under section 
1103 with respect to each covered commodity on a 
farm, the Secretary shall give the producers on the 
farm an opportunity to elect to instead receive rev-
enue-based counter-cyclical payments under this sec-
tion for the 2008 through 2012 crop years. 
(2) SINGLE ELECTION; TIME FOR ELECTION.— 
As soon as practicable after the date of enactment 
of this Act, the Secretary shall provide notice to pro-
ducers regarding their opportunity to make the elec-
tion described in paragraph (1). The notice shall in-
clude the following: 
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(A) Notice that the opportunity of the pro-
ducers on a farm to make the election is being 
provided only once. 
(B) Information regarding the manner in 
which the election must be made and the time 
periods and manner in which notice of the elec-
tion must be submitted to the Secretary. 
(3) ELECTION DEADLINE.—Within the time pe-
riod and in the manner prescribed pursuant to para-
graph (2), the producers on a farm shall submit to 
the Secretary notice of the election made under 
paragraph (1). 
(4) EFFECT
OF
FAILURE
TO
MAKE
ELEC-
TION.—If the producers on a farm fail to make the 
election under paragraph (1) or fail to timely notify 
the Secretary of the election made, as required by 
paragraph (3), the producers shall be deemed to 
have made the election to receive counter-cyclical 
payments under section 1103 for all covered com-
modities on the farm. 
(b) PAYMENT REQUIRED.—In the case of producers 
on a farm who make the election under subsection (a) to 
receive revenue-based counter-cyclical payments, the Sec-
retary shall make revenue-based counter-cyclical payments 
to such producers with respect to a covered commodity 
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on the farm, if the Secretary determines that the national 
actual revenue per acre for the covered commodity is less 
than the national target revenue per acre for the covered 
commodity, as determined pursuant to this section. 
(c) NATIONAL ACTUAL REVENUE PER ACRE.—For 
each covered commodity for each of the 2008 through 
2012 crop years, the Secretary shall establish a national 
actual revenue per acre by multiplying the national aver-
age yield for the given year by the higher of— 
(1) the national average market price received 
by producers of the covered commodity during the 
12-month marketing year established by the Sec-
retary; or 
(2) the loan rate for the covered commodity 
under section 1202, except that, for the purpose of 
calculating national actual revenue per acre for rice 
and barley, the Secretary shall establish national av-
erage all rice and all barley loan rates. 
(d) NATIONAL TARGET REVENUE PER ACRE.—The 
national target revenue per acre shall be, on a per acre 
basis, as follows: 
(1) Wheat, $149.92. 
(2) Corn, $344.12. 
(3) Grain Sorghum, $131.28. 
(4) Barley, $153.30. 
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(5) Oats, $92.10 
(6) Upland cotton, $496.93. 
(7) Rice, $548.06. 
(8) Soybeans, $231.87. 
(9) Other oilseeds, $129.18. 
(10) Peanuts, $683.83. 
(e) NATIONAL PAYMENT YIELD.—The national pay-
ment yield shall be as follows: 
(1) Wheat, 36.1 bushels per acre. 
(2) Corn, 114.4 bushels per acre. 
(3) Grain Sorghum, 58.2 bushels per acre. 
(4) Barley, 48.6 bushels per acre. 
(5) Oats, 49.8 bushels per acre. 
(6) Upland cotton, 634 pounds per acre. 
(7) Rice, 51.28 hundredweight per acre. 
(8) Soybeans, 34.1 bushels per acre. 
(9) Other oilseeds, 1167.6 pounds per acre. 
(10) Peanuts, 1.496 tons per acre. 
(f) NATIONAL PAYMENT RATE.—The national pay-
ment rate used to make revenue-based counter-cyclical 
payments for a crop year shall be the result of— 
(1) the difference between the national target 
revenue per acre for the covered commodity and the 
national actual revenue per acre for the covered 
commodity; divided by 
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(2) the national payment yield for the covered 
commodity. 
(g) PAYMENT AMOUNT.—If revenue-based counter- 
cyclical payments are required to be paid for any of the 
2008 through 2012 crop years of a covered commodity, 
the amount of the counter-cyclical payment to be paid to 
the producers on a farm for that crop year for the covered 
commodity shall be equal to the product of— 
(1) the national payment rate for the covered 
commodity; 
(2) the payment acres of the covered commodity 
on the farm; and 
(3) the payment yield for counter-cyclical pay-
ments for the covered commodity. 
(h) TIME FOR PAYMENTS.— 
(1) GENERAL RULE.—If the Secretary deter-
mines that revenue-based counter-cyclical payments 
are required to be made under this section for the 
crop of a covered commodity, the Secretary shall 
make the counter-cyclical payments for the crop as 
soon as practicable after the end of the 12-month 
marketing year for the covered commodity. 
(2) AVAILABILITY OF PARTIAL PAYMENTS.—If, 
before the end of the 12-month marketing year for 
a covered commodity, the Secretary estimates that 
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revenue-based counter-cyclical payments will be re-
quired for the crop of the covered commodity, the 
Secretary shall give producers on a farm the option 
to receive partial payments of the revenue-based 
counter-cyclical payments projected to be made for 
that crop of the covered commodity. 
(3) TIME
FOR
PARTIAL
PAYMENTS
FOR
2008 
THROUGH 2010 CROP YEARS.—If the Secretary is re-
quired to make partial payments available under 
paragraph (2) for a covered commodity for any of 
the 2008 through 2010 crop years— 
(A) the first partial payment shall be made 
after completion of the first 6 months of the 
marketing year for the covered commodity; and 
(B) the final partial payment shall be 
made the later of the following: 
(i) As soon as practicable after the 
end of the 12-month marketing year for 
the covered commodity. 
(ii) October 1 of the fiscal year start-
ing in the same calendar year as the end 
of the marketing year. 
(4) AMOUNT OF PARTIAL PAYMENTS.— 
(A) FIRST PARTIAL PAYMENT.—For each 
of the 2008 through 2010 crop years, the first 
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partial payment under paragraph (3) to the 
producers on a farm may not exceed 40 percent 
of the projected revenue-based counter-cyclical 
payment for the covered commodity for the crop 
year, as determined by the Secretary. 
(B) FINAL PAYMENT.—The final payment 
for each of the 2008 through 2010 crop years 
shall be equal to the difference between— 
(i) the actual revenue-based counter- 
cyclical payments to be made to the pro-
ducers for the covered commodity for that 
crop year; and 
(ii) the amount of the partial payment 
made to the producers on a farm under 
subparagraph (A) for that crop year. 
(5) REPAYMENT.—Producers on a farm that 
receive a partial payment under this subsection for 
a crop year shall repay to the Secretary the amount, 
if any, by which the total of the partial payments ex-
ceed the actual revenue-based counter-cyclical pay-
ments to be made for the covered commodity for 
that crop year. 
(i) PROHIBITION ON DE MINIMIS PAYMENTS.—If the 
total revenue-based counter-cyclical payment to be paid to 
a producer on a farm for all covered commodities is less 
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than $25.00, the Secretary shall not tender the revenue- 
based counter-cyclical payment to the producer. 
SEC. 1105. PRODUCER AGREEMENT REQUIRED AS CONDI-
TION OF PROVISION OF DIRECT PAYMENTS 
AND COUNTER-CYCLICAL PAYMENTS. 
(a) COMPLIANCE WITH CERTAIN REQUIREMENTS.— 
(1) REQUIREMENTS.—Before the producers on 
a farm may receive direct payments or counter-cycli-
cal payments with respect to the farm, the producers 
shall agree, during the crop year for which the pay-
ments are made and in exchange for the payments— 
(A) to comply with applicable conservation 
requirements under subtitle B of title XII of 
the Food Security Act of 1985 (16 U.S.C. 3811 
et seq.); 
(B) to comply with applicable wetland pro-
tection requirements under subtitle C of title 
XII of that Act (16 U.S.C. 3821 et seq.); 
(C) to comply with the planting flexibility 
requirements of section 1106; 
(D) to use the land on the farm, in a 
quantity equal to the attributable base acres for 
the farm for an agricultural or conserving use, 
and not for a nonagricultural commercial or in-
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dustrial use, as determined by the Secretary; 
and 
(E) to effectively control noxious weeds 
and otherwise maintain the land in accordance 
with sound agricultural practices, as determined 
by the Secretary. 
(2) COMPLIANCE.—The Secretary may issue 
such rules as the Secretary considers necessary to 
ensure producer compliance with the requirements of 
paragraph (1). 
(3) MODIFICATION.—At the request of the 
transferee or owner, the Secretary may modify the 
requirements of this subsection if the modifications 
are consistent with the objectives of this subsection, 
as determined by the Secretary. 
(b) TRANSFER
OR
CHANGE
OF
INTEREST
IN 
FARM.— 
(1) TERMINATION.— 
(A) IN GENERAL.—Except as provided in 
paragraph (2), a transfer of (or change in) the 
interest of the producers on a farm in base 
acres for which direct payments or counter-cy-
clical payments are made shall result in the ter-
mination of the payments with respect to the 
base acres, unless the transferee or owner of 
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the acreage agrees to assume all obligations 
under subsection (a). 
(B) EFFECTIVE
DATE.—The termination 
shall take effect on the date determined by the 
Secretary. 
(2) EXCEPTION.—If a producer entitled to a di-
rect payment or counter-cyclical payment dies, be-
comes incompetent, or is otherwise unable to receive 
the payment, the Secretary shall make the payment, 
in accordance with rules issued by the Secretary. 
(c) ACREAGE REPORTS.—As a condition on the re-
ceipt of any benefits under this subtitle or subtitle B, the 
Secretary shall require producers on a farm to submit to 
the Secretary annual acreage reports with respect to all 
cropland on the farm. 
(d) TENANTS AND SHARECROPPERS.—In carrying 
out this subtitle, the Secretary shall provide adequate safe-
guards to protect the interests of tenants and share-
croppers. 
(e) SHARING OF PAYMENTS.—The Secretary shall 
provide for the sharing of direct payments and counter- 
cyclical payments among the producers on a farm on a 
fair and equitable basis. 
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SEC. 1106. PLANTING FLEXIBILITY. 
(a) PERMITTED CROPS.—Subject to subsection (b), 
any commodity or crop may be planted on base acres on 
a farm. 
(b) LIMITATIONS REGARDING CERTAIN COMMOD-
ITIES.— 
(1) GENERAL LIMITATION.—The planting of an 
agricultural commodity specified in paragraph (3) 
shall be prohibited on base acres unless the com-
modity, if planted, is destroyed before harvest. 
(2) TREATMENT
OF
TREES
AND
OTHER 
PERENNIALS.—The planting of an agricultural com-
modity specified in paragraph (3) that is produced 
on a tree or other perennial plant shall be prohibited 
on base acres. 
(3) COVERED AGRICULTURAL COMMODITIES.— 
Paragraphs (1) and (2) apply to the following agri-
cultural commodities: 
(A) Fruits. 
(B) Vegetables (other than lentils, mung 
beans, and dry peas). 
(C) Wild rice. 
(c) EXCEPTIONS.—Paragraphs (1) and (2) of sub-
section (b) shall not limit the planting of an agricultural 
commodity specified in paragraph (3) of that subsection— 
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(1) in any region in which there is a history of 
double-cropping of covered commodities with agricul-
tural commodities specified in subsection (b)(3), as 
determined by the Secretary, in which case the dou-
ble-cropping shall be permitted; 
(2) on a farm that the Secretary determines 
has a history of planting agricultural commodities 
specified in subsection (b)(3) on base acres, except 
that direct payments and counter-cyclical payments 
shall be reduced by an acre for each acre planted to 
such an agricultural commodity; or 
(3) by the producers on a farm that the Sec-
retary determines has an established planting his-
tory of a specific agricultural commodity specified in 
subsection (b)(3), except that— 
(A) the quantity planted may not exceed 
the average annual planting history of such ag-
ricultural commodity by the producers on the 
farm in the 1991 through 1995 or 1998 
through 2001 crop years (excluding any crop 
year in which no plantings were made), as de-
termined by the Secretary; and 
(B) direct payments and counter-cyclical 
payments shall be reduced by an acre for each 
acre planted to such agricultural commodity. 
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(d) PLANTING TRANSFERABILITY PILOT PROJECT.— 
(1) PILOT PROJECT AUTHORIZED.—In addition 
to the exceptions provided in subsection (c), the Sec-
retary shall carry out a pilot project in the State of 
Indiana under which paragraphs (1) and (2) of sub-
section (b) shall not limit the planting of tomatoes 
grown for processing on up to 10,000 base acres 
during each of the 2008 through 2012 crop years. 
(2) CONTRACT
AND
MANAGEMENT
REQUIRE-
MENTS.—To be eligible for selection to participate in 
the pilot project, a producer must— 
(A) have a contract to grow tomatoes for 
processing; and 
(B) agree to produce the tomatoes as part 
of a program of crop rotation on the farm to 
achieve agronomic and pest and disease man-
agement benefits. 
(3) TEMPORARY REDUCTION IN BASE ACRES.— 
The base acres on a farm for a crop year shall be 
reduced by an acre for each acre planted to tomatoes 
under the pilot program. 
(4) DURATION
OF
REDUCTIONS.—The reduc-
tion in the base acres of a farm for a crop year 
under paragraph (3) shall expire at the end of the 
crop year, unless the producers on the farm elect to 
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continue to participate in the pilot project for the 
subsequent crop year. 
(5) RECALCULATION OF BASE ACRES.—If the 
Secretary recalculates base acres for a farm while 
the farm is included in the pilot project, the planting 
and production of tomatoes under the pilot project 
shall be considered to be the same as the planting, 
prevented planting, or production of a covered com-
modity. Nothing in this paragraph provides author-
ity for the Secretary to recalculate base acres for a 
farm. 
SEC. 1107. PERIOD OF EFFECTIVENESS. 
This subtitle shall be effective beginning with the 
2008 crop year of each covered commodity through the 
2012 crop year. 
Subtitle B—Marketing Assistance 
Loans and Loan Deficiency Pay-
ments 
SEC. 1201. AVAILABILITY OF NONRECOURSE MARKETING 
ASSISTANCE LOANS FOR LOAN COMMOD-
ITIES. 
(a) NONRECOURSE LOANS AVAILABLE.— 
(1) AVAILABILITY.—For each of the 2008 
through 2012 crops of each loan commodity, the 
Secretary shall make available to producers on a 
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farm nonrecourse marketing assistance loans for 
loan commodities produced on the farm. 
(2) TERMS AND CONDITIONS.—The marketing 
assistance loans shall be made under terms and con-
ditions that are prescribed by the Secretary and at 
the loan rate established under section 1202 for the 
loan commodity. 
(b) ELIGIBLE PRODUCTION.—The producers on a 
farm shall be eligible for a marketing assistance loan 
under subsection (a) for any quantity of a loan commodity 
produced on the farm. 
(c) TREATMENT OF CERTAIN COMMINGLED COM-
MODITIES.—In carrying out this subtitle, the Secretary 
shall make loans to producers on a farm that would be 
eligible to obtain a marketing assistance loan, but for the 
fact the loan commodity owned by the producers on the 
farm commingled with loan commodities of other pro-
ducers in facilities unlicensed for the storage of agricul-
tural commodities by the Secretary or a State licensing 
authority, if the producers obtaining the loan agree to im-
mediately redeem the loan collateral in accordance with 
section 166 of the Federal Agriculture Improvement and 
Reform Act of 1996 (7 U.S.C. 7286). 
(d) COMPLIANCE WITH CONSERVATION AND WET-
LANDS REQUIREMENTS.—As a condition of the receipt of 
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a marketing assistance loan under subsection (a), the pro-
ducer shall comply with applicable conservation require-
ments under subtitle B of title XII of the Food Security 
Act of 1985 (16 U.S.C. 3811 et seq.) and applicable wet-
land protection requirements under subtitle C of title XII 
of the Act (16 U.S.C. 3821 et seq.) during the term of 
the loan. 
(e) PEANUT-RELATED LOAN PROVISIONS.— 
(1) OPTIONS FOR OBTAINING LOANS.—A mar-
keting assistance loan for peanuts under this section 
and loan deficiency payments for peanuts under sec-
tion 1205 may be obtained at option of the pro-
ducers on a farm through— 
(A) a designated marketing association or 
marketing cooperative of producers that is ap-
proved by the Secretary; or 
(B) the Farm Service Agency. 
(2) STORAGE OF LOAN PEANUTS.—As a condi-
tion on the Secretary’s approval of an individual or 
entity to provide storage for peanuts for which a 
marketing assistance loan is made under this sec-
tion, the individual or entity shall agree— 
(A) to provide such storage on a non-
discriminatory basis; and 
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(B) to comply with such additional require-
ments as the Secretary considers appropriate to 
accomplish the purposes of this section and pro-
mote fairness in the administration of the bene-
fits of this section. 
(3) MARKETING.—A marketing association or 
cooperative may market peanuts for which a loan is 
made under this section in any manner that con-
forms to consumer needs, including the separation of 
peanuts by type and quality. 
SEC. 1202. LOAN RATES FOR NONRECOURSE MARKETING 
ASSISTANCE LOANS. 
(a) LOAN RATES.—The loan rate for a marketing as-
sistance loan under section 1201 for a loan commodity 
shall be equal to the following: 
(1) In the case of wheat, $2.94 per bushel. 
(2) In the case of corn, $1.95 per bushel. 
(3) In the case of grain sorghum, $1.95 per 
bushel. 
(4) In the case of malt barley, $2.50 per bushel. 
(5) In the case of feed barley, $1.90 per bushel. 
(6) In the case of oats, $1.46 per bushel. 
(7) In the case of the base quality of upland 
cotton, $0.52 per pound. 
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(8) In the case of extra long staple cotton, 
$0.7977 per pound. 
(9) In the case of long grain rice, $6.50 per 
hundredweight. 
(10) In the case of medium grain rice and short 
grain rice, $6.50 per hundredweight. 
(11) In the case of soybeans, $5.00 per bushel. 
(12) In the case of other oilseeds, $0.1070 per 
pound for each of the following kinds of oilseeds: 
(A) Sunflower seed. 
(B) Rapeseed. 
(C) Canola. 
(D) Safflower. 
(E) Flaxseed. 
(F) Mustard seed. 
(G) Crambe. 
(H) Sesame seed. 
(I) Other oilseeds designated by the Sec-
retary. 
(13) In the case of dry peas, $5.40 per hun-
dredweight. 
(14) In the case of lentils, $11.28 per hundred-
weight. 
(15) In the case of small chickpeas, $8.54 per 
hundredweight. 
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(16) In the case of peanuts, $355.00 per ton. 
(17) In the case of graded wool, $1.10 per 
pound. 
(18) In the case of nongraded wool, $0.40 per 
pound. 
(19) In the case of honey, $0.60 per pound. 
(20) In the case of mohair, $4.20 per pound. 
(b) SINGLE COUNTY LOAN RATE FOR OTHER OIL-
SEEDS.—The Secretary shall establish a single loan rate 
in each county for each kind of other oilseeds described 
in subsection (a)(12). 
(c) SPECIAL RULES FOR CORN AND GRAIN SOR-
GHUM.— 
(1) SINGLE COUNTY AND NATIONAL AVERAGE 
LOAN RATE.—The Secretary shall— 
(A) establish a single county loan rate for 
corn and grain sorghum in each county; 
(B) establish a single national average loan 
rate for corn and grain sorghum; and 
(C) determine each county loan rate and 
the national average loan rate for corn and 
grain sorghum and any and all other program 
loan rates applicable to corn and grain sorghum 
from a data set that includes prices for both 
commodities. 
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(2) ADMINISTRATION.—With respect to corn 
and grain sorghum, the Secretary— 
(A) shall administer the applicable loan, 
marketing loan, counter-cyclical payment, and 
related programs from a single loan rate for 
corn and grain sorghum that is identical in 
each individual county; 
(B) shall provide that any adjustment in 
the loan rate for location shall be determined 
and applied on the basis of the combined data 
set such that any transportation adjustment 
shall be the same for corn and grain sorghum 
in each individual county; and 
(C) may provide for adjustments for grade, 
type, and quality as appropriate for the corn or 
grain sorghum involved in each specific trans-
action. 
SEC. 1203. TERM OF LOANS. 
(a) TERM OF LOAN.—In the case of each loan com-
modity, a marketing assistance loan under section 1201 
shall have a term of 9 months beginning on the first day 
of the first month after the month in which the loan is 
made. 
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(b) EXTENSIONS PROHIBITED.—The Secretary may 
not extend the term of a marketing assistance loan for 
any loan commodity. 
SEC. 1204. REPAYMENT OF LOANS. 
(a) GENERAL RULE.—The Secretary shall permit the 
producers on a farm to repay a marketing assistance loan 
under section 1201 for a loan commodity (other than up-
land cotton, long grain rice, medium grain rice, short 
grain rice, extra long staple cotton, and confectionery and 
each other kind of sunflower seed (other than oil sunflower 
seed)) at the lesser of the following: 
(1) The loan rate established for the commodity 
under section 1202, plus interest (determined in ac-
cordance with section 163 of the Federal Agriculture 
Improvement and Reform Act of 1996 (7 U.S.C. 
7283)). 
(2) A rate that the Secretary determines will— 
(A) minimize potential loan forfeitures; 
(B) minimize the accumulation of stocks of 
the commodity by the Federal Government; 
(C) minimize the cost incurred by the Fed-
eral Government in storing the commodity; 
(D) allow the commodity produced in the 
United States to be marketed freely and com-
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petitively, both domestically and internationally; 
and 
(E) minimize discrepancies in marketing 
loan benefits across State boundaries and 
across county boundaries, if applicable. 
(b) REPAYMENT RATES FOR UPLAND COTTON AND 
RICE.—The Secretary shall permit producers to repay a 
marketing assistance loan under section 1201 for upland 
cotton, long grain rice, medium grain rice, and short grain 
rice at a rate that is the lesser of— 
(1) the loan rate established for the commodity 
under section 1202, plus interest (determined in ac-
cordance with section 163 of the Federal Agriculture 
Improvement and Reform Act of 1996 (7 U.S.C. 
7283)); or 
(2) the prevailing world market price for the 
commodity (adjusted to United States quality and 
location), as determined by the Secretary. 
(c) REPAYMENT RATES FOR EXTRA LONG STAPLE 
COTTON.—Repayment of a marketing assistance loan for 
extra long staple cotton shall be at the loan rate estab-
lished for the commodity under section 1202, plus interest 
(determined in accordance with section 163 of the Federal 
Agriculture Improvement and Reform Act of 1996 (7 
U.S.C. 7283)). 
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(d) PREVAILING WORLD MARKET PRICE.—For pur-
poses of this section and section 1207, the Secretary shall 
prescribe by regulation— 
(1) a formula to determine the prevailing world 
market price for upland cotton, which shall be based 
on the Far East price of upland cotton; 
(2) a formula to determine the prevailing world 
market price for— 
(A) long grain rice; and 
(B) medium and short grain rice; 
(3) a mechanism by which the Secretary will 
announce periodically the prevailing world market 
price for upland cotton, long grain rice, and medium 
and short grain rice; and 
(4) a mechanism by which the Secretary will 
make the adjustments, required by subsection (e), to 
the prevailing world market price for upland cotton, 
long grain rice, and medium and short grain rice. 
(e) ADJUSTMENT OF PREVAILING WORLD MARKET 
PRICE FOR UPLAND COTTON AND RICE.— 
(1) RICE.—The prevailing world market price 
for long grain, medium grain, and short grain rice 
determined in subsection (d) shall be adjusted to 
United States quality and location. 
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(2) COTTON.—The prevailing world market 
price for upland cotton, determined in subsection (d) 
shall be— 
(A) adjusted to United States quality and 
location, with such quality adjustment to in-
clude— 
(i) any existing United States loan 
schedule premiums for Comparable United 
States Quality; and 
(ii) a reduction equal to any United 
States Premium Factor to upland cotton of 
a quality higher than Middling (M) 13⁄32- 
inch; and 
(B) adjusted to take into account average 
costs to market the commodity, including aver-
age transportation costs, as determined by the 
Secretary. 
(f) ADDITIONAL ADJUSTMENT AUTHORITY REGARD-
ING PREVAILING WORLD MARKET PRICE FOR UPLAND 
COTTON.— 
(1) IN GENERAL.—During the period beginning 
on the date of the enactment of this Act through 
July 31, 2013, the Secretary may further adjust the 
prevailing world market price for upland cotton (ad-
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justed under subsection (d)) if the Secretary deter-
mines such adjustment necessary— 
(A) to minimize potential loan forfeitures; 
(B) to minimize the accumulation of stocks 
of the commodity by the Federal Government; 
(C) to allow the commodity produced in 
the United States to be marketed freely and 
competitively, both domestically and inter-
nationally; 
(D) to ensure that United States cotton is 
competitive in world markets; and 
(E) to ensure an appropriate transition be-
tween current-crop and forward-crop price 
quotations, except that the Secretary may use 
forward-crop price quotations prior to July 31 
of the current marketing year only if there are 
less than three current-crop price quotations 
and only if such forward-crop price quotation is 
the lowest such quotation available. 
(2) GUIDELINES
FOR
ADDITIONAL
ADJUST-
MENT.—In further adjusting the prevailing world 
market price for upland cotton under this sub-
section, the Secretary shall establish a mechanism 
for determining and announcing such adjustments in 
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order to avoid undue disruption in the United States 
market. 
(g) REPAYMENT RATES FOR CONFECTIONERY AND 
OTHER KINDS OF SUNFLOWER SEEDS.—The Secretary 
shall permit the producers on a farm to repay a marketing 
assistance loan under section 1201 for confectionery and 
each other kind of sunflower seed (other than oil sunflower 
seed) at a rate that is the lesser of— 
(1) the loan rate established for the commodity 
under section 1202, plus interest (determined in ac-
cordance with section 163 of the Federal Agriculture 
Improvement and Reform Act of 1996 (7 U.S.C. 
7283)); or 
(2) the repayment rate established for oil sun-
flower seed. 
(h) QUALITY GRADES FOR DRY PEAS, LENTILS, AND 
SMALL CHICKPEAS.—The loan repayment rate for dry 
peas, lentils, and small chickpeas shall be based on the 
quality grades for the applicable commodity. 
SEC. 1205. LOAN DEFICIENCY PAYMENTS. 
(a) AVAILABILITY
OF
LOAN
DEFICIENCY
PAY-
MENTS.— 
(1) IN GENERAL.—Except as provided in sub-
section (d), the Secretary may make loan deficiency 
payments available to producers on a farm that, al-
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though eligible to obtain a marketing assistance loan 
under section 1201 with respect to a loan com-
modity, agree to forgo obtaining the loan for the 
commodity in return for loan deficiency payments 
under this section. 
(2) UNSHORN PELTS, HAY, AND SILAGE.— 
(A) MARKETING
ASSISTANCE
LOANS.— 
Subject to subparagraph (B), nongraded wool 
in the form of unshorn pelts and hay and silage 
derived from a loan commodity are not eligible 
for a marketing assistance loan under section 
1201. 
(B) LOAN DEFICIENCY PAYMENT.—Effec-
tive for the 2008 through 2012 crop years, the 
Secretary may make loan deficiency payments 
available under this section to producers on a 
farm that produce unshorn pelts or hay and si-
lage derived from a loan commodity. 
(b) COMPUTATION.—A loan deficiency payment for a 
loan commodity or commodity referred to in subsection 
(a)(2) shall be computed by multiplying— 
(1) the payment rate determined under sub-
section (c) for the commodity; by 
(2) the quantity of the commodity produced by 
the eligible producers, excluding any quantity for 
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which the producers obtain a marketing assistance 
loan under section 1201. 
(c) PAYMENT RATE.— 
(1) IN GENERAL.—In the case of a loan com-
modity, the payment rate shall be the amount by 
which— 
(A) the loan rate established under section 
1202 for the loan commodity; exceeds 
(B) the rate at which a marketing assist-
ance loan for the loan commodity may be repaid 
under section 1204. 
(2) UNSHORN PELTS.—In the case of unshorn 
pelts, the payment rate shall be the amount by 
which— 
(A) the loan rate established under section 
1202 for ungraded wool; exceeds 
(B) the rate at which a marketing assist-
ance loan for ungraded wool may be repaid 
under section 1204. 
(3) HAY AND SILAGE.—In the case of hay or si-
lage derived from a loan commodity, the payment 
rate shall be the amount by which— 
(A) the loan rate established under section 
1202 for the loan commodity from which the 
hay or silage is derived; exceeds 
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(B) the rate at which a marketing assist-
ance loan for the loan commodity may be repaid 
under section 1204. 
(d) EXCEPTION
FOR EXTRA LONG STAPLE COT-
TON.—This section shall not apply with respect to extra 
long staple cotton. 
(e) EFFECTIVE DATE FOR PAYMENT RATE DETER-
MINATION.—The Secretary shall determine the amount of 
the loan deficiency payment to be made under this section 
to the producers on a farm with respect to a quantity of 
a loan commodity or commodity referred to in subsection 
(a)(2) using the payment rate in effect under subsection 
(c) as of the date the producers request the payment. 
SEC. 1206. PAYMENTS IN LIEU OF LOAN DEFICIENCY PAY-
MENTS FOR GRAZED ACREAGE. 
(a) ELIGIBLE PRODUCERS.— 
(1) IN
GENERAL.—Effective for the 2008 
through 2012 crop years, in the case of a producer 
that would be eligible for a loan deficiency payment 
under section 1205 for wheat, barley, or oats, but 
that elects to use acreage planted to the wheat, bar-
ley, or oats for the grazing of livestock, the Sec-
retary shall make a payment to the producer under 
this section if the producer enters into an agreement 
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with the Secretary to forgo any other harvesting of 
the wheat, barley, or oats on that acreage. 
(2) GRAZING OF TRITICALE ACREAGE.—Effec-
tive for the 2008 through 2012 crop years, with re-
spect to a producer on a farm that uses acreage 
planted to triticale for the grazing of livestock, the 
Secretary shall make a payment to the producer 
under this section if the producer enters into an 
agreement with the Secretary to forgo any other 
harvesting of triticale on that acreage. 
(b) PAYMENT AMOUNT.— 
(1) IN GENERAL.—The amount of a payment 
made under this section to a producer on a farm de-
scribed in subsection (a)(1) shall be equal to the 
amount determined by multiplying— 
(A) the loan deficiency payment rate deter-
mined under section 1205(c) in effect, as of the 
date of the agreement, for the county in which 
the farm is located; by 
(B) the payment quantity determined by 
multiplying— 
(i) the quantity of the grazed acreage 
on the farm with respect to which the pro-
ducer elects to forgo harvesting of wheat, 
barley, or oats; and 
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