USDA Announces GSM-102 Credit Guarantees for Export Sales To Republic of Korea
WASHINGTON, May 7, 2013 – The U.S. Department of Agriculture today amends availability of the following credit guarantees for sales of U.S. agricultural commodities under the Commodity Credit Corporation's Export Credit Guarantee Program (GSM-102) for fiscal year 2013.
Additional Amount Available: $500,000,000
Geographical Area: Republic of Korea (South Korea)
The GSM-102 program provides credit guarantees to encourage financing of commercial exports of U.S. agricultural products, primarily to developing countries, while providing competitive credit terms. Under this program, the Commodity Credit Corporation (CCC) reduces the financial risk to lenders by guaranteeing payments due from approved foreign banks to exporters or financial institutions in the United States.
This program announcement is issued in accordance with title 7, section 1493.10(d), of the Code of Federal Regulations.
APPLICATIONS FOR COVERAGE
CCC will initially consider applications under this announcement received between 9 a.m. (Eastern Time) and 4 p.m. (Eastern Time) on Friday, May 10, 2013. All applications received by CCC within these times will be considered as having been received at the same time. Therefore, exporters should submit only one copy of each application. If the total dollar amount of the applications received within the time frame specified above exceeds the total dollar amount of the announced allocations, CCC will determine the distribution of the announced allocation. Applications received after the ending date and time specified in this announcement will be considered on a first-come, first-serve basis.
Exporters are reminded that a firm sale must exist between the buyer and seller prior to submission of an application for a guarantee. Exporters must limit the maximum total guarantee value of all submitted applications to the amount of coverage available under this announcement and all applications are subject to sufficient country and bank limits.
All applications submitted must be accompanied by the full guarantee fee. Fees may be submitted with the application or submitted separately by check or wire transfer, but all application fees must be received by CCC by 11:59 p.m. (Eastern Time) on the same day that the application is received by CCC. Each fee payment should note the applicant name, the sale number, the country/region name, and the amount of fee to be allocated to each application (if one payment is submitted to cover multiple applications). CCC will not consider any applications where the fee is not submitted within this time frame.
TERMS OF COVERAGE
Coverage is available to cover sales of any of the commodities specified in the GSM list of commodities. The latest commodity list can be obtained by accessing the Foreign Agricultural Service (FAS) Web page at http://www.fas.usda.gov/excredits/gsmcommodities.html.
Exporters’ contractual arrangements must call for exports no later than 90 days from the date of registration or Nov. 30, 2013, whichever date is earlier.
Requests for extensions to the export date must be submitted in writing and will only be permitted on a case by case basis. CCC does not anticipate granting any extensions unless the exporter can demonstrate that circumstances beyond the exporter’s control precluded export by the final date to export on the guarantee.
In accordance with 7 CFR 1493.20(v) (1), this announcement offers coverage on a free-alongside-ship or free-on-board basis. If commodities are sold on a cost-and-freight or cost-insurance-and-freight basis, coverage on a cost-and-freight basis to point of ocean transportation or international air carrier discharge is also available in accordance with 7 CFR 1493.20(v)(2). Coverage is not available under this announcement for insurance costs.
Coverage of up to 98 percent of the principal is offered on credit terms based on the obligor country risk category as specified in the table below. Adjustable interest coverage is also offered in accordance with FAS program announcement PR 0138-08 issued Sept. 4, 2008, or as superseded. A complete list of countries and their associated risk category is available on the CCC “Country Risk Category” Web page located at http://www.fas.usda.gov/excredits/countryrisk.html.
Obligor (Foreign Bank) Country Risk Category
0, 1, 2, 3 or 4
Up to 2 years (24 months)
Up to 1.5 years (18 months)
Up to 1 year
Credit terms for solid wood products, wood pulp, and wood chips are limited to the lesser of 720 days or the maximum tenor as determined by the allowable tenor permitted for the obligor country risk category.
Pursuant to 7 CFR 1493.60(e), the exporter may request reserve coverage to cover contract loading tolerances. If coverage is available, CCC will grant reserve coverage of up to 10 percent of the requested guarantee value provided the sales contract allows for this loading tolerance.
ELIGIBLE BANKS IN THE REPUBLIC OF KOREA
Any bank approved by CCC for this country is eligible. For a complete list of eligible banks, refer to the CCC “GSM Program Foreign Bank Obligors” Web page located at http://www.fas.usda.gov/excredits/foreignbanks.html. Exporters are advised to obtain from their foreign buyer the name of the CCC‑approved foreign bank that will be opening the letter of credit.
GUARANTEE FEE RATES
Pursuant to 7 CFR 1493.70, for a complete list of fees refer to CCC’s “GSM-102 Guarantee Fee Rate Schedule” at http://www.fas.usda.gov/excredits/gsm102fees.html. These fees are listed by risk category. A complete list of countries and their associated risk category is available on the CCC “Country Risk Category” at http://www.fas.usda.gov/excredits/countryrisk.html.
POINTS OF CONTACT
For further information, contact the Registrations and Operations Branch of FAS at (202) 720-3224, or by e-mail at firstname.lastname@example.org.
For the latest updates on FAS programs and activities, go to the FAS Web page at http://www.fas.usda.gov/excredits/ecgp.asp.