UPDATED: 1625 CST Tuesday February 8, 2022 – The Canadian Grain Commission is starting 2022 by sharing a bit of good news and bad news with prairie farmers.
The good news is that growers owed money by the now defunct Pipeline Foods will be fully compensated.
The CGC is issuing cheques totaling $2.2 million to the 49 producers owed money by the United States company and its Canadian subsidiary, Pipeline Foods ULC in Canada.
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Pipeline filed for bankruptcy protection in July 2021. The company had a dealer license in Canada and operated two primary elevators at Gull Lake and Wapella, Sask.
“The Canadian Grain Commission is committed to ensuring producers are fairly compensated for their deliveries,” chief commissioner Doug Chorney said in a press release.
“Our Safeguards for Grain Farmers Program plays a key role in securing payments for producers and we are very pleased to be able to fully compensate eligible producers for unpaid deliveries to Pipeline Foods.”
Unfortunately the same cannot be said for farmers who delivered grain to W.A. Grain & Pulse Solutions.
“There won’t be 100 percent payout in this case,” said CGC spokesperson Remi Gosselin.
The CGC received claims from 129 producers totaling $7.2 million. Cheques for 79 percent of that amount will be mailed out to farmers by the end of February or early March.
That will be approximately 10 months after W.A. Grains’ official receivership date of April 26, 2021.
“We realize that producers had to wait a significant amount of time here,” said Gosselin, “but we took every step possible to maximize compensation for producers.”
He said the CGC strives for 100 percent compensation but it can’t guarantee that level of success in every case.
The bulk of the compensation package comes from a $4 million insurance policy with Intact Insurance that fell far short of the total liabilities.
Another $1.5 million was derived from the sale of grain inventory.
A third pool of money was available for nine producers deemed eligible to receive compensation under the Bankruptcy Insolvency Act because they delivered their
grain 15 days prior to the receivership date. They are getting $198,318.
W.A. Grain owned and operated pulse processing plants in Vanguard, Pambrun and Ponteix, Sask. as well as Bashaw and Bowden, Alta.
GP Acres Grain Inc. purchased the Saskatchewan plants, Global Food and Ingredients bought the Bowden facility and 2371394 Alberta Ltd. acquired the Bashaw plant.
Gosselin has a message for all growers who deliver grain in 2022.
“What we’d like to remind producers is to cash their cheques immediately,” he said.
“When they don’t cash their cheques it’s the equivalent of lending their money to the grain company.”
In rare instances, that “loan” is not repaid in full.
Contact sean.pratt@producer.com