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Farm Credit Administration (FCA), an independent agency of the executive branch of the federal government that supervises and coordinates the Farm Credit System for American agriculture. The Farm Credit Act of 1971, which superseded all previous legislation, established the FCA to provide long-term and short-term credit to farmers and their cooperatives. Long-term mortgage loans help farmers acquire property or refinance existing debts; short-term loans are needed to finance crop and livestock production and marketing. In addition, the FCA makes emergency crop and feed loans to farmers who cannot obtain funds from other sources.
Credit used by farmers and cooperatives derives from the FCA through a network of farm credit banks, federal land bank associations, production credit associations, and banks for cooperatives. The farm credit banks make loans to agricultural cooperatives for periods ranging from six months to three years. The loans are secured by warehouse receipts for crops or by liens on livestock. The land banks function as credit wholesalers, raising funds in the investment markets through the sale of bonds and lending the money to farmers at low interest rates. Production credit associations finance short-term credit associations, and banks for cooperatives finance cooperative marketing. Other components of the Farm Credit system include the Agricultural Credit Bank, agricultural credit associations, and federal land credit associations.
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