A bill to amend the Food, Conservation, and Energy Act of 2008 to establish a market-driven inventory system.

SECTION 1. MARKET-DRIVEN INVENTORY SYSTEM.

    (a) In General.--Subtitle B of title I of the Food, Conservation, 
and Energy Act of 2008 (7 U.S.C. 8731 et seq.) is amended by adding at 
the end the following:

``SEC. 1211. MARKET-DRIVEN INVENTORY SYSTEM.

    ``(a) Definitions.--In this section:
            ``(1) Inventory cap.--The term `inventory cap' means the 
        market commodity-specific limitations on participation in the 
        program described in subsection (b)(3).
            ``(2) Market commodity.--The term `market commodity' means 
        corn, oats, barley, grain sorghum, wheat, and soybeans.
            ``(3) Program.--The term `program' means the market-driven 
        inventory system program established in accordance with this 
        section.
            ``(4) Storage period.--The term `storage period' means, for 
        a market commodity enrolled in the program, the period that--
                    ``(A) begins on the date of enrollment of the 
                market commodity in the program; and
                    ``(B) ends on the date on which the Secretary 
                authorizes loan repayment and release under subsection 
                (d).
    ``(b) Recourse Loans Available.--
            ``(1) In general.--Subject to paragraph (3), for each of 
        the 2014 through 2018 crops of each market commodity, the 
        Secretary shall make available recourse loans in accordance 
        with this section to producers on a farm that elect to 
        participate in the program for 1 or more market commodities.
            ``(2) Enrollment.--
                    ``(A) In general.--Enrollment in the program shall 
                be voluntary and considered on a rolling basis.
                    ``(B) Limitations.--
                            ``(i) In general.--The Secretary may 
                        implement enrollment restrictions if the market 
                        prices of a market commodity are close to the 
                        recourse loan rate or the release price 
                        described in subsection (d)(2).
                            ``(ii) End of restrictions.--Any enrollment 
                        restrictions implemented under clause (i) for a 
                        market commodity shall end as soon as the 
                        Secretary determines that the 1-month average 
                        of the market commodity is below the recourse 
                        loan rate for that market commodity.
            ``(3) Inventory cap.--Participation in the program for 
        corn, wheat, and soybeans shall be limited to not more than the 
        following:
                    ``(A) Corn, 3,000,000,000 bushels.
                    ``(B) Oats, 20,000,000 bushels.
                    ``(C) Barley, 40,000,000 bushels.
                    ``(D) Grain sorghum, 40,000,000 bushels.
                    ``(E) Wheat, 800,000,000 bushels.
                    ``(F) Soybeans, 400,000,000 bushels.
    ``(c) Storage Period.--
            ``(1) In general.--As a condition of participation, for 
        each market commodity that the producers on a farm enroll in 
        the program, the producers on the farm shall, throughout the 
        storage period--
                    ``(A) store the market commodity;
                    ``(B) maintain the market commodity in proper 
                condition, as determined by the Secretary; and
                    ``(C) not sell or otherwise release into the market 
                the market commodity.
            ``(2) Ownership.--During the storage period--
                    ``(A) title to the market commodity shall remain 
                with the producers on the farm, subject to the 
                conditions on participation described in paragraph (1); 
                and
                    ``(B) the Secretary shall have a first lien on the 
                market commodity for which a recourse loan under this 
                section is received.
            ``(3) Payment.--
                    ``(A) In general.--During the storage period, the 
                Secretary shall make storage payments to the producers 
                on the farm at a rate of $0.40 per bushel of market 
                commodity per crop year.
                    ``(B) Duration.--The Secretary shall terminate the 
                making of storage payments for a market commodity to 
                producers on a farm on the date on which the release 
                price for the market commodity is triggered in 
                accordance with subsection (d).
    ``(d) Loan Repayment and Release.--
            ``(1) In general.--Subject to paragraph (4), the Secretary 
        shall authorize loan repayment and release for a market 
        commodity on the date on which the release price for that 
        market commodity is triggered.
            ``(2) Release price.--The release price for a market 
        commodity shall be equal to 160 percent of the applicable 
        recourse loan rate described in subsection (e).
            ``(3) Producer options.--Subject to paragraph (4), once the 
        Secretary has authorized loan repayment and release for a 
        market commodity, the producers on a farm may--
                    ``(A) sell or otherwise release into the market the 
                market commodity; or
                    ``(B) continue to store the market commodity, but 
                without receiving additional storage payments for the 
                market commodity.
            ``(4) Partial release.--
                    ``(A) In general.--Regardless of whether the 
                inventory cap for a market commodity has been reached, 
                if the Secretary determines, based on available 
                information, that the total quantity of the market 
                commodity stored is so great that release of all of the 
                stored market commodity into the market would depress 
                market prices below the release level, the Secretary 
                may establish a maximum release quantity to limit the 
                sale and release of the stored market commodity.
                    ``(B) Administration.--In the case of a partial 
                release described in subparagraph (A)--
                            ``(i) the producers on a farm that first 
                        enrolled in the program shall be eligible first 
                        to sell or otherwise release into the market 
                        the stored market commodity; and
                            ``(ii) the producers on a farm that do not 
                        have the option of selling or otherwise 
                        releasing into the market the stored market 
                        commodity shall continue to be eligible to 
                        receive storage payments for the market 
                        commodity.
    ``(e) Recourse Loan Rates.--For purposes of each of the 2014 
through 2018 crop years, the recourse loan rate for a market commodity 
under this section shall be equal to the following:
            ``(1) Corn, $3.50 per bushel.
            ``(2) Oats, $2.49 per bushel.
            ``(3) Barley, $3.50 per bushel.
            ``(4) Grain sorghum, $3.50 per bushel.
            ``(5) Wheat, $5.28 per bushel.
            ``(6) Soybeans, $8.97 per bushel.
    ``(f) Set-Aside Program.--
            ``(1) In general.--If the inventory cap for a market 
        commodity is reached and the market price of the market 
        commodity is below the recourse loan rate for the market 
        commodity, the Secretary may establish a set-aside program 
        under which producers on a farm may remove acres from 
        production for the following crop year.
            ``(2) Eligibility.--To be eligible to enroll acres in the 
        set-aside program under paragraph (1), the producers on a farm 
        shall be required to have produced the applicable market 
        commodity during at least 1 of the last 2 crop years, as 
        determined by the Secretary.
            ``(3) Requirements.--
                    ``(A) Cover crop.--
                            ``(i) In general.--As a condition on 
                        participation in the set-aside program, 
                        producers on a farm shall be required to 
                        maintain an approved cover crop on all enrolled 
                        acreage.
                            ``(ii) Planting flexibility.--Producers on 
                        a farm may plant any crop on acreage not 
                        enrolled in the set-aside program.
                    ``(B) Secretarial discretion.--If the Secretary 
                establishes a set-aside program under paragraph (1), 
                the Secretary shall determine, at the discretion of the 
                Secretary--
                            ``(i) the amount of the payment to be made 
                        to producers that elect to participate in the 
                        set-aside program;
                            ``(ii) the percentage of the total acreage 
                        planted to the market commodity that the 
                        producers are required to remove from 
                        production as a condition of participation; and
                            ``(iii) the extent to which grazing and 
                        other noncommercial uses of the land enrolled 
                        in the set-aside program shall be permitted.''.
    (b) Conforming Amendments.--
            (1) Section 1001 of the Food, Conservation, and Energy Act 
        of 2008 (7 U.S.C. 8702) is amended--
                    (A) in paragraph (4)--
                            (i) by striking ``wheat, corn, grain 
                        sorghum, barley, oats''; and
                            (ii) by striking ``soybeans''; and
                    (B) in paragraph (8)--
                            (i) by striking ``wheat, corn, grain 
                        sorghum, barley, oats''; and
                            (ii) by striking ``soybeans''.
            (2) Section 1103(b) of the Food, Conservation, and Energy 
        Act of 2008 (7 U.S.C. 8713) is amended--
                    (A) by striking paragraphs (1), (2), (3), (4), (5), 
                and (9); and
                    (B) by redesignating paragraphs (6), (7), (8), and 
                (10) as paragraphs (1), (2), (3), and (4), 
                respectively.
            (3) Section 1104(c)(3) of the Food, Conservation, and 
        Energy Act of 2008 (7 U.S.C. 8714(c)(3)) is amended--
                    (A) by striking subparagraphs (A), (B), (C), (D), 
                (E), and (I); and
                    (B) by redesignating subparagraphs (F), (G), and 
                (H) and (J) through (N) as subparagraphs (A), (B), and 
                (C) and (D) through (H), respectively.
            (4) Section 1202(c) of the Food, Conservation, and Energy 
        Act of 2008 (7 U.S.C. 8732(c)) is amended--
                    (A) by striking paragraphs (1), (2), (3), (4), (5), 
                and (10); and
                    (B) by redesignating paragraphs (6) through (9) and 
                (11) through (19) as paragraphs (1) through (4) and (5) 
                through (13), respectively.
    (c) Application.--The amendments made by this section apply 
beginning with the 2014 crop of a market commodity (as defined in 
section 1211(a) of the Food, Conservation, and Energy Act of 2008 (as 
added by subsection (a))).

Summary: Amends the Food, Conservation, and Energy Act of 2008 to direct the Secretary of Agriculture (USDA), for each of the 2014-2018 crops of each market commodity, to make recourse loans available to producers on a farm electing to participate in the program.  Sets forth: (1) the recourse loan rate for corn, oats, barley, grain sorghum, wheat, and soybeans; and (2) market commodity-specific limitations on participation (inventory caps) for such crops. Requires participating producers, until the Secretary authorizes loan repayment and release, to: (1) store and maintain the market commodity, and (2) not sell or otherwise release the commodity into the market. Provides that during such storage period: (1) title to the commodity shall remain with the producers, and (2) the Secretary shall have a first lien on the commodity for which a recourse loan is received. Provides USDA payments to producers at $0.40 per bushel per crop year.  Authorizes the Secretary to establish a partial commodity release if the market release of all of the stored commodity would depress prices below the release level. Authorizes the Secretary to establish a set-aside program under which qualifying producers on a farm may remove acres from production for the following crop year if the inventory cap for a commodity is reached and such commodity's market price is below the recourse loan rate. Requires participating producers to maintain a cover crop on all enrolled acreage.