USRPA joined 11 other agriculture groups in sending a letter today to USDA’s Under Secretary for Farm and Foreign Agricultural Services, Jim Miller, relaying concerns about the tenor restrictions imposed on the FY2010 GSM-102 Export Credit Guarantee Program as well as USDA’s country risk rating practices.  USRPA and other producer groups are concerned that the tenor restrictions imposed on this year’s program will ultimately hamper US exports of agricultural products.

The amount of time for repayment, or tenor, of credit guarantees along with fee rates are driving factors of the GSM program’s viability. With tighter tenor restrictions and a fee structure based on country risk ratings, US agriculture groups face the possibility of losing prospective GSM program users and snubbing markets with active users of the program.

“A tenor of up to three years should be available for all programs.  If USDA/FAS is considering limiting the tenor for a particular program to less than three years, it should consult with industry, in advance, to gauge the impact on program utilization and exports,” the letter states.

The GSM program allocations for FY2010, which began last October 1, were announced on November 13, 2009 to be $1.2 billion.  Since 1997, the program has supported $35.37 billion in US farm exports, including $84 million in US rice. 

Read the letter submitted to Under Secretary Miller below.