Biofuel Advocates Want to Loosen Rules for Farm Credit

from Wallaces Farmer:
Rod Swoboda rswoboda@farmprogress.com
November 11, 2007

A group of leaders involved in Iowa's renewable fuels industry is calling for expansion of the Farm Credit System's lending authority. They want a change in federal law so Farm Credit would be allowed to make loans to build ethanol and biodiesel plants that do not have a majority of farmer-stockholders as owners.

The group has sent a letter to both of Iowa's U.S. Senators, Chuck Grassley and Tom Harkin, and to other senators. The letter asks them to support expansion of Farm Credit's lending authority because of difficulties in expanding the renewable fuels industry and maintaining its profitability. An amendment has been proposed to add to the new farm bill being debated in Congress.

Farm Credit has been making farm loans for over 90 years and understands the challenges of agriculture, the letter points out. Because of that experience, the system has the ability and capacity to structure loans that account for the variables in the renewable fuels industry.

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