Survey reveals producers stressed by failure to fulfil grain contract obligations

The Agricultural Producers Association of Saskatchewan (APAS) has released preliminary results of a survey on producer experiences with grain contracts.

After hearing concerns about the stress and financial burdens of not fulfilling their contracts due to the drought this growing season, APAS created the survey and collected responses from Aug. 26 to Dec. 1.

Of the 200 farmers who participated, 75 per cent were unable to meet their obligations.

The devastating drought also impacted the provincial coffers. Finance Minister Donna Harpauer said Monday it triggered the largest payout of crop insurance in Saskatchewan’s history.

APAS president Todd Lewis said since the dry conditions covered a significant area of the province, it was important to determine how widespread a problem it is.

“We developed this survey to get more information about producers’ individual experiences with the grain companies, so we can develop ideas around improving provisions in future contracts,” Lewis said. “It’s in the mutual interest of both producers and grain companies to develop a more workable system.”

The survey found producers unable to fulfil their contract this fall due to historically low yields are paying penalties and administrative fees between $20,000 and $300,000 to grain companies. Many of the respondents also said the interest on their unpaid contracts was as high as 19 per cent.

Many of the respondents said they will not be working with the same grain company in the future or will not be signing a contract again. Some respondents included that they are facing bankruptcy due to drought and contract shortfalls.

APAS advised producers to seek legal advice if needed.

Lewis said the survey will remain open for farmers to share their experiences. The survey can be found here.

Farmers experiencing significant stress can reach out to the Farm Stress Line at 1-800-667-4442 or help@farmstressline.ca.

By Alice McFarlane, northeastNOW