A bill to amend the Agriculture and Food Act of 1981 to provide protection for agricultural purchasers of farm products.

(Reported to Senate from the Committee on Agriculture, Nutrition and Forestry with amendment, S. Rept. 99-147)

States that, notwithstanding any other provision of Federal, State, or local law, a buyer who in the ordinary course of business buys farm products from a seller engaged in farming operations shall take free of any seller-created security interest even though the security interest is perfected and the buyer knows of its existence, unless: (1) within 12 months prior to the sale the buyer has received written notice from the seller or secured party of the security interest and any payment obligation on the buyer as a condition for release of the interest; and (2) the buyer fails to perform such obligations.

States that, notwithstanding any other provision of Federal, State, or local law, a commission merchant or selling agent who in the ordinary course of business sells farm products for another person will not be liable to the holder of a security interest in such products even though the security interest is perfected and the commission merchant or selling agent knows of its existence.

Authorizes such security agreements to require an agricultural borrower pledging farm products as loan security to furnish a list of potential purchasers to the secured party. Establishes compliance procedures in the event pledged products are sold to an unlisted purchaser, including fines of up to $5,000 for noncompliance.