What Happened?

Farmers who use government loans on their crops will see higher loan rates starting with the 2026 crop year, after a federal budget law raised the statutory rates for 2026 through 2031, which makes price-support payments more likely to be triggered. The Congressional Research Service (CRS) published a report titled "Farm Bill Primer: MAL and LDP Farm Support Programs," and the changes to farm loan rates are drawn from it. ​

The Marketing Assistance Loan (MAL) program gives farmers low-interest, nine-month loans on stored crops; the Loan Deficiency Payment (LDP) program pays equivalent price-support benefits to farmers who choose not to take out those loans. Both programs are open to producers of eligible commodities, including corn, wheat, soybeans, cotton, and honey, with no income or acreage threshold stated in the report.

The corn MAL rate rose from $2.20 to $2.42 per bushel for crop years 2026 through 2031, a 10 percent increase. The honey MAL rate more than doubled, from $0.69 to $1.50 per pound, the largest proportional increase among the commodities listed in the report's rate table.

Why Does it Matter to Me?

Higher loan rates make it more likely that farmers will trigger price-support payments and receive higher-valued loans.

The Agriculture Improvement Act of 2018 removed the annual per-person and per-entity caps on MAL and LDP benefits. Program outlays peaked at $263 million in crop year 2020 (adjusted to 2026 dollars) before falling to $79 million in crop year 2025, showing how sharply costs swing with market conditions.

When the government pays farmers to store or sell crops at a floor price, it affects what farmers grow and how much they produce, with ripple effects for anyone who buys food.

Both Sides, Now

The higher rates make marketing loan gains and Loan Deficiency Payments more likely to be triggered, and they let farmers take out larger loans on stored commodities.

The 2018 farm law removed annual per-person and per-entity caps on the payments, and some policymakers now want the caps reinstated to limit costs and address concerns about payments to large farms. A U.S. Government Accountability Office report found that in 2015, 50 farming operations received an average of $884,495 each in farm-program payments, and one operation received $3.7 million, according to the U.S. Government Accountability Office, Farm Programs: Information on Payments.

The U.S. Department of Agriculture's Farm Service Agency administers both programs, which receive mandatory appropriations through the Commodity Credit Corporation.

What Happens Next?

The Farm, Food, and National Security Act of 2026, which passed the House in April, is now awaiting action in the Senate and would make no changes to the MAL or LDP programs. It would, however, allow farmers to repay nonrecourse MALs during USDA furloughs caused by a lapse in government funding.

CRS notes that Congress could consider further modifying the MAL and LDP programs to reduce the need for future supplemental support, but any expansion beyond the current farm bill baseline may require cuts to other farm bill priorities.

The Senate holds the power to advance or block the farm bill: will it reopen the debate over payment limits?

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