Source: POLITICO'S MORNING AGRICULTURE, 1/7/20

Alternative farm lender Agrifund LLC, which operates as Ag Resource Management, or ARM, has received about $75 million under the Trump administration's tariff relief program for farmers, according to the Midwest Center for Investigative Reporting.

Here's how it works: Direct payments from the Agriculture Department are intended to reimburse producers whose ag exports have plummeted since President Donald Trump picked a trade fight with China in 2018. But USDA rules allow recipients to reroute their payments to third parties, and farmers indebted to ARM are required to do so under their contract with the firm, according to a company spokesperson.

That has allowed the Texas-based firm to receive $35 million through the 2018 program and another $40 million so far under the 2019 iteration. The next highest recipient is AgCountry Farm Credit Services, a Midwestern lender that has received $37 million in tariff relief payments, according to the Midwest Center.

So-called alternative lenders like ARM are more lightly regulated and generally charge higher interest rates than traditional farm banks. They can offer a lifeline to farmers who have a hard time getting loans from more strictly regulated firms during the current ag economy downturn — but those same loans can prove treacherous for producers who fall behind, as MA readers will recall.

USDA has paid farmers $10.75 billion so far for 2019 production, sending checks to some 644,000 producers, a spokesperson told MA. That's in addition to $8.6 billion paid out for 2018 trade losses. Farmers in Iowa, Illinois, Texas, Minnesota and Kansas have received the most funds for 2019.