Cheques are in the mail for eligible farmers owed money by the now defunct ILTA Grain Inc.
A list of 222 eligible growers will receive full compensation for losses amounting to $11.15 million.
Another 49 claims worth $1.5 million were deemed ineligible.
It is the biggest security payout in the history of the Canadian Grain Commission, said CGC spokesperson Remi Gosselin.
“In terms of proportion and scale, it’s the largest we’ve ever seen. We’ve never seen anything near 200 claims before,” he said.
The next biggest payout was $3 million in the Newco Grain case of 2012. There were 144 eligible claims in that incident.
Not every farmer owed money in the ILTA receivership made a claim. The CGC estimates growers were owed about $14 million when the pulse and special crops processing firm filed for creditor protection.
Farmer deliveries include $2.12 million in canaryseed that will not be paid because it is not an eligible crop under the Canada Grain Act, according to a court document filed by ILTA Monitor, PricewaterhouseCoopers (PWC).
Another $646,540 was deemed ineligible because farmers either failed to ask for payment within 90 days of receiving a primary elevator receipt or cashed their cheques within 30 days of the issue date.
In the last 35 years, the CGC has dealt with 24 company failures and has issued payments that have covered 94 percent of total losses, according to the commission’s website.
The CGC is placing increased scrutiny on the pulse sector, which has been experiencing difficulty since 2018 when India started restricting imports of peas, lentils and chickpeas.
“Because of the situation with the pulse industry, the grain commission has taken extra steps to conduct more field audits,” said Gosselin.
“The best protection that producers can have in situations like these is to cash their cheques immediately.”
The Canary Seed Development Commission of Saskatchewan plans to debate the pros and cons of becoming an eligible crop at its annual general meeting on Jan. 13.
Producers attending the meeting will be asked to vote on a resolution to become a regulated crop.
Gosselin said the CGC held consultations with canaryseed farmers in 2002 and again in 2005 but there was no consensus at that time.
“The concern was that it would increase cost to the sector in terms of security provision and also that the market was not large enough,” he said.
“We remain open to discussing this option with the sector again.”
If producers decide they want canaryseed to be a covered crop there will be months of consultations followed by a time-consuming process for changing the regulations.
“If it were added, the sector would be subject to all requirements under the act including official grading standards and licensing,” said Gosselin.
Farmers are not the only ones who lost money in the ILTA debacle.
The sale of ILTA’s six processing facilities to Viterra, ETG Commodities and DG Global Inc., netted $84.3 million.
More money was raised by selling grain inventory and collecting accounts receivable. But it wasn’t enough to cover what was owed to the company’s two main lenders.
HSBC was owed $48.7 million when ILTA filed for creditor protection. The bank received $32.6 million in proceeds from the sale of ILTA’s assets, leaving a shortfall of $16.1 million.
Farm Credit Canada (FCC) is the other big lender. It has received $81.2 million of the $88.3 million it was owed, leaving a shortfall of $7.1 million.
HSBC and insurance company Atradius are in a legal dispute over the remaining $2.9 million in a $14 million escrow and trust fund.