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Agricultural Bond

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What is an Agricultural Bond?

As part of U.S. Department of Agriculture and state regulations, certain businesses in the agricultural field need to hold an agricultural bond. An agricultural bond is structured similarly to other types of surety bonds in that it offers a safeguard to regulatory agencies that the business will function in line with rules laid out in the Packers and Stockyards Act.

Market agencies, dealers, and agricultural packers must secure an agricultural bond, sometimes referred to as a stockyards bond, so that a form of protection exists when the sale of agricultural products and livestock takes place.

How Does an Agricultural Bond Work?

An agricultural bond is a surety bond that represents a contract between several different parties. The agriculture business is the principal, or the party that is required to hold the bond. The state or federal organization requiring the bond to be in place is known as the obligee, and the surety company provides the bond itself.

Should an agricultural business not comply with state or federal laws when dealing with the sale of agricultural products or livestock, a claim may be made against the bond. Any legitimate claim is paid by the surety, and then repayment is made by you, the bondholder.

How Much Does an Agricultural Bond Cost?

The cost of an agricultural bond depends on a few different factors, including the amount of the bond required by a state or federal agency where the business operates. The higher the bond amount, the higher the cost of the bond has the potential to be. Agricultural bond prices also depend on your business and personal financial situation, including aspects like your personal credit score and business assets and liabilities. If you have a less than ideal credit score, or you do not have strong business financials, you may pay more for your agricultural bond.

The good news is that you are not required to pay the total amount of the agricultural bond to fulfill the bonding requirement. Instead, you pay a fraction of this amount, based on the percentage rate your surety agency provides. This percentage can be as low as 1 to 2%. For example, if your business is required to have a $30,000 bond, and your percentage rate is 2%, you would pay $600 for your agricultural bond premium.


Frequent Questions

How much does this bond cost?

The cost is usually 1 – 10% of the bond amount. Keep in mind that pricing varies based on the bond amount, and your financial strength.

What is the process?

Apply and get approved on our website, sign the surety agreements, and we will ship the bond out.

Can I get this bond with bad credit?

Yes, it’s possible, but bad credit usually results in higher rates.

Does it matter where I get a bond?

Yes. We provide the lowest rates possible as a result of the large volume of bonds we write.

What if a false claim is filed?

You must contact us immediately, as we have a team of claim specialists here to find a resolution for you.


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Jennifer Henson
Our company has been with JW Surety for several years now so when we needed to obtain a bond for a new company, we immediately went to them for help. Our rep, Melissa, was extremely helpful and prompt which made the process extremely easy for me.
David Tillotson
Trying to get a local Surety Bond was like driving a car on three tires. I searched Surety Bonds and found JW Surety Bonds. I got online and filled out the information and with in 30 minutes received a response from Melissa. She was informative, friendly and helpful. One more super satisfied customer.

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