Saskatchewan crop commissions have passed a resolution calling on the federal government to ensure future grain contracts fairly treat farmers.
The resolution that made the rounds at the 2022 annual general meetings calls for delivery contracts to be rolled forward to the next year or terminated without administration fees when a crop failure is not the fault of the grower.
Vanscoy-area farmer Glenn Wright tabled the resolution following a year in which many farmers were unable to fulfill the terms of the delivery contracts they signed because the 2021 drought slashed their crop yields.
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In some cases, the administration fees were waived. In other cases, farmers were forced to pay a penalty as high as $1.50 per bushel.
Wright accused some grain companies of dragging their feet, waiting for prices to climb before forcing farmers to buy out their contracts.
He said grain companies draft the contracts, which are full of legalese that protects their interests.
The general terms of the contracts are commonly determined by phone call or text message.
“We often don’t even get a chance to see the whole contract. We are usually just negotiating price and the delivery month,” he said during the SaskCanola meeting.
“With the drought in 2021 we were all sort of caught after years of playing fast and loose with these contracts.”
He wants the federal government to use the ongoing Canada Grain Act review to ensure there are legislated protections for farmers embedded in future contracts.
That proposal didn’t sit well with every farmer attending the meetings.
Jeff Mathieson, a grower from Watson, Sask., agrees that some producer protections must be incorporated into contracts but he doesn’t want to go the regulatory route.
“We ask that the government stay out of our business and allow us to run our businesses the way we see fit,” he said.
“I don’t believe it’s in our best interest to ask our (grain company) customers to have the government come in and tell them how to run their businesses either.”
Mathieson thinks the same goals can be achieved by commissions working together to exert pressure on grain companies.
Wright said he understands where Mathieson is coming from and noted that similar concerns were raised at other commission meetings.
“We have worked for years to try and get government out of our marketing,” he said.
But he stressed that the resolution isn’t about changing the way grain is marketed in Western Canada. It is simply about avoiding harsh penalties in years when crop failure is no fault of the farmer.
“These are pretty basic protections and it’s not really impeding the open market,” he said.
Wright said the resolution supports the lobbying the commissions were already doing.
He noted that the wording of the resolution gives them latitude on how to navigate that task.
He said farm groups have been pushing for standardized contract terms for years to no avail.
Wright thinks now is the time to capitalize on the anger and frustration bubbling up over this “hot topic.”
SaskCanola chair Bernie McClean said growers have a powerful ally in this cause.
He has a letter from Saskatchewan Agriculture minister David Marit stating that the province is working with farm groups on ways to strengthen the grain contracting process through revisions to the Canada Grain Act.
“They’re listening to us,” he told farmers attending the meeting.
For more content related to drought management visit The Dry Times, where you can find a collection of stories from our family of publications as well as links to external resources to support your decisions through these difficult times.
