What Are Agricultural Bonds?
Agricultural packers, market agencies, and dealers need to obtain agricultural bonds in order to comply with the U.S. Department of Agriculture’s requirements, as well as with state regulations. Agricultural bonds have also been known as agricultural packers and stockyards bonds.
This type of surety bond acts as a safety net for the federal government and the state you operate in. It guarantees that agricultural businesses will abide by the rules set forth in the Packers and Stockyards Act, and will account properly for sales of agricultural products and livestock.
Like other surety bonds, agricultural bonds function like a three-party contract. Your agricultural business is the principal that needs to obtain the bond. The federal or state authority requiring the bond is the obligee. The surety is the entity which provides the bond.
Questions about Agricultural Packers Bonds
Who needs to obtain an agricultural bond?
Different kinds of agricultural businesses need to get an agricultural surety bond. Some of them include packers, market agencies and dealers, which are required to get bonded by the U.S. Department of Agriculture.
However, in a number of states, these companies also need to get a bond to meet state agencies’ requirements. Some of the businesses that have to be bonded include cotton dealers and warehouses, grain dealers and warehouses, agricultural brokers, distributors, dealers and sales agents, and livestock and equine dealers and brokers.
How much does an agricultural bond cost?
The major factor that determines the price of your agricultural bond is the bond amount you are required to obtain. This amount is set by the federal or state authority that regulates your business activity. In some cases, it can be a predefined amount, while in others, the bond amount can be based on your business volume.
While your bond amount can be significant, the bond premium that you have to pay to get bonded is only a fraction of it. If your financial situation is stable, your bonding rates can be as low as 1% to 2.5%. A simple calculation shows that for a $20,000 bond, you might end up paying only $200 to $500.
The bond price is set whenever you apply with a surety. It examines your personal and business finances, including your personal credit score, business financial records, and assets and liquidity. The bond premium is lower if your overall profile is strong.
Our surety bond cost page is a great resource on how your bond price is determined.
Can I get bonded with bad credit?
For agricultural businesses with problematic finances, getting bonded can be a challenge. Lance Surety Bonds’ experts are aware of these difficulties, which is why we operate our Bad Credit Surety Bonds program. It’s here to help bond applicants with low credit scores, tax liens, bankruptcies, or civil judgements to obtain the bond they need.
As the risk of bonding is higher, the bond premiums are in the range of 5% and 10%. With us, however, you can rely on a top bonding rate for your situation. We foster close relations with a number of A-rated, T-listed surety companies. This allows us to shop around for the best matching bond option for you.
How can I get an agricultural bond?
Getting your agricultural bonds is not complicated. You can apply online today for a free bond quote and receive it in no time.
For an exact bond price, just complete the full application package online and attach all necessary paperwork.
Need more information? You can always refer to our How to Get Bonded page for a complete overview of the bonding process.
If you have any questions or concerns, we’re here to help. Just call us at (877) 514-5146. Lance Surety Bonds’ specialists will assist you with your application or bonding queries.
How are bond claims handled for agricultural bonds?
Unlike insurance, surety bonds do not protect your agricultural business. In fact, they work in the interest of federal and state authorities and the general public. They guarantee that your company will abide by all relevant laws and will make all due payments in relation to your business activity.
In case you break your obligations, a claim can be made on your agricultural bond. If proven, the surety will have to financially compensate the affected party. The maximum claim amount is the penal sum of your bond. Afterwards your business is liable to repay it in full.
Claims can lead to serious financial damages for your business. Besides that, getting bonded after a proven claim can be difficult, which means that your future opportunities can be jeopardized as well. The wisest course of action is to avoid situations that can lead to claims as much as possible.
Find Your Surety Bond
|California||SURETY BOND / PRODUCE DEALERS ACT||Department of Food & Agriculture||Apply Now|
|Federal Government||REQUIRED OF LIVESTOCK MARKET AGENCIES, DEALERS, AN||US Dept of Agriculture||Apply Now|
|Federal Government||H-2A Labor Contractors Bond||U.S. Department of Labor||Apply Now|
|Federal Government||H-2 Farm Labor Contractor Bond||US Deptartment of Labor||Apply Now|
|Federal Government||US DOL Farm Contractor Bond||US Department of Labor||Apply Now|
|Federal Government||USDA Warehouse Operator's Bond||U.S. Department of Agriculture||Apply Now|
|Federal Government||Livestock Market Agencies, Dealers, & Packers||US Department of Agriculture||Apply Now|
|Florida||Agricultural Products Dealer Bond||Commissioner of Agriculture||Apply Now|
|Florida||Citrus Fruit Dealer's||Dept of Agricultural & Consumer Services||Apply Now|
|Florida||Agricultural Products Dealer||Florida Department of Agriculture and Consumer Ser||Apply Now|
|Florida||Agricultural Products Dealer||Florida Department of Agricultural||Apply Now|
|Florida||CITRUS FRUIT DEALER’S||Florida Commissioner of Agriculture||Apply Now|
|Florida||BOND OF CITRUS FRUIT DEALER (PAYMENT OF CITRUS EXC||FLORIDA DEPT OF AGRICULTURE||Apply Now|
|Florida||BOND OF CITRUS FRUIT DEALER (PAYMENT OF CITRUS INS||FLORIDA DEPT OF CITRUS||Apply Now|
|Florida||Fertilizer Dealer Bond||Florida Department of Agriculture and Consumer||Apply Now|
|Georgia||Warehouseman's||Department of Agriculture||Apply Now|
|Georgia||Grain Dealer||Commissioner of Agriculture c/o Bonding Section||Apply Now|
|Illinois||Timber Buyer||IL Dept. of Natural Resources Office of Law Enfor.||Apply Now|
|Indiana||Livestock Market Facilities and Dealers Bond||Indiana State Board of Health||Apply Now|
|Minnesota||Agricultural (Non-Livestock) Bond||Minnesota Dept of Agriculture||Apply Now|
|New Jersey||Secretary of Agriculture||Secretary of Agriculture of The State of NJ||Apply Now|
|New York||Farm Products Dealer Bond||Dept of Agriculture and markets||Apply Now|
|North Carolina||Grain Dealer's Bond||NC Dept. of Agriculture and Consumer Serv.||Apply Now|
|North Dakota||Roving Grain Buyer's Bond||North Dakota Public Services COmmission||Apply Now|
|North Dakota||Roving Grain Buyer's Bond||Public Service Commission||Apply Now|
|Ohio||Auction Firm Bond||Argicultural Department||Apply Now|
|Tennessee||Pesticides||Tennessee Department of Agriculture||Apply Now|
|Tennessee||Pest Control License Bond||Tennessee Department of Agriculture||Apply Now|
|Texas||Child and Adult Care Food Program Bond||Texas Department of Agriculture||Apply Now|
|Washington||Agricultural Dealer||WA State Dept of Agriculture||Apply Now|
|Wisconsin||Public Warehouse Keeper Bond||WI Department of Agriculture||Apply Now|