Sask. producer groups say they have found little interest among grain companies in changing how contracts are written
Saskatchewan crop organizations continue to work on a resolution, passed at their 2022 annual general meetings, that called for the various commissions to lobby for fairer grain delivery contracts.
Shaun Dyrland, chair of Saskatchewan Pulse Growers, told delegates attending the 2023 annual general meeting that the groups hired Mercantile Consulting Venture to conduct an analysis of contracts.
“The study confirmed what many growers already knew,” he said. “It found that grain purchase contracts are heavily tilted in favour of grain buyers and put farmers at a disadvantage.”
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The crop groups met with the Western Grain Elevator Association to discuss the report’s findings.
“The response from the WGEA was, the grain companies did not see a need to make changes to their grain contracts,” said Dyrland.
Tracy Broughton, executive director of the Saskatchewan Canola Development Commission, had a different take on that meeting. She said the WGEA told the groups that it was not able to speak about commercial issues on behalf of its members.
“They have recommended that we talk directly with the grain companies,” Broughton told delegates attending the 2023 SaskCanola AGM.
However, she did mention there doesn’t appear to be much appetite for changing the way contracts are written.
“There is definitely no interest in offloading the risk from farmers to grain companies,” she said. “However, we find there’s room for improvement.”
Growers want administrative fees removed from contract buyouts when a producer provides evidence of crop failure.
They want all contracts to include a buyout clause with a pricing formula at the time of signing that is triggered when producers provide notice of a crop failure.
And they want the changes to be applied evenly to all grain contracts signed in Saskatchewan.
Broughton said the shortcomings of grain contracts were magnified during the drought year of 2021, but have been a thorn in the side of farmers for a lot longer than that.
Saskatchewan crop groups have also met with the provincial government and the Canadian Grain Commission to discuss the grain contract issue.
She said the next step is to meet with each major grain buyer individually to discuss a path forward.
Dyrland also indicated that the year-old resolution is not dead.
“Our groups plan to engage with grain buyers to push for better balance and transparency in grain contracts,” he said.
