WINNIPEG – Companies which process or market special crops will need a licence if a federal committee studying how the industry should be regulated has its way.
But producers will finance their own security fund through an optional marketing levy, committee chair Daryl Rumble told the Canadian Special Crops Association annual meeting last week.
The Saskatchewan farmer heads an 18-member committee that has spent the past year developing recommendations for how the burgeoning special crops industry should be administered. The group’s recommendations are being circulated through the industry for comments before being finalized.
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Currently companies in the special crops business do not require Canadian Grain Commission licensing or monitoring if they are handling crops not stipulated under the Canada Grains Act.
Rumble said many producers don’t understand that.
No security
“We were somewhat surprised at the confusion. We were somewhat more surprised at how many producers were marketing product thinking they had total security, when they’d had no security for three or four years.”
The committee is proposing a two-tier system of licensing from which there would be no exceptions, even for farmer to farmer business. “If you take possession of a farmer’s product, you need a licence. If you don’t (have a licence) you don’t do business.”
One category would be for processors who do not take financial ownership of the farmer’s product. A second category would include businesses which buy product from farmers.
Licenced buyers would be responsible for collecting a levy from producers for a security fund, in the event there was a business bankruptcy resulting in losses to farmers. The fund, which farmers could opt out, would pay 85 percent of the scale ticket value at the time of the bankruptcy.
