It’s been overshadowed by the shutdown and subsequent reopening of the federal government, but an announcement made by USDA that it would stop processing commodity loans could cost producers and merchants significantly.

As Congress was in the middle of its futile, last-ditch effort to fund the government Sept. 30, USDA said it would reduce loans and stop loan processing as part of its effort to accommodate the automatic funding reductions known as the sequester program and the shutdown of the government.

USDA’s Farm Service Agency said commodity loans "would be subject to sequester reductions of 5.1 percent and loan-making for all commodities would be suspended Oct. 1.” The agency said in its Sept. 30 announcement the loans were targeted to resume in mid-October, but, since then, FSA has not moved to re-open the program.