Loans Available to Producers Waiting for Cotton Seed to be Ginned

USDA Seed Cotton Recourse Loans Available through March 31, 2019

(Safford, AZ), Dec. 14, 2018 – Loans are available through USDA’s Farm Service Agency (FSA) to provide interim financing to cotton producers while waiting for their cotton to be ginned. Graham and Greenlee County producers can apply for FSA’s seed cotton recourse loans from the beginning of harvest through March 31, 2019.

“In some regions, this year’s adverse weather has resulted in delays in cotton harvest and ginning,” said FSA Acting County Executive Director Carol Case. “Seed cotton loans provide interim financing from the time cotton is harvested until the cotton is ginned.”

Recourse loans must be repaid by May 31, 2019, either by cash repayment by the producer, or with proceeds from a ginned cotton loan.

The loan rate is the base loan rate for upland cotton, which is $0.52 per pound, and $0.7977 per pound for extra-long staple cotton.

Repaying Recourse Loan with Proceeds

FSA staff will provide written or e-mail notification to every cooperative marketing association or loan servicing agent used by the producer to ensure that the proceeds from a ginned cotton loan are used to repay any seed cotton loan obligation.

If after ginning, the lint from seed cotton loan collateral is placed under loan or loan deficiency payment from a cooperative marketing association or loan servicing agent, the proceeds will be applied to the seed cotton recourse loan as a repayment.

More Information

To apply for a recourse loan or get more information, contact the FSA staff at your local USDA service center. Find your nearest service center at