Grain Producers to Receive Partial Compensation
Producers who have not received payment for grain delivered to Global Food and Ingredients Inc. will be compensated for their eligible claims via the Canadian Grain Commission’s Safeguards for Grain Farmers Program.
After reviewing individual producer claims, the Canadian Grain Commission identified 29 eligible claims totaling $2.661 million for unpaid deliveries to the company.
However, since Global Food and Ingredients Inc. only had $2 million in security, the compensation will be prorated. Consequently, producers will receive 75% of their eligible claims, and cheques have been mailed to the affected producers.
“While 100% compensation is always the goal, we are pleased to provide the maximum available compensation to eligible producers," said David Hunt, Chief Commissioner of the Canadian Grain Commission. "By working closely with the receiver, we may be able to provide some additional compensation beyond the security held”.
The Safeguards for Grain Farmers Program is designed to regulate grain companies and mitigate the risks of payment failures to producers while supporting the grain quality assurance system.
Licensed grain companies must secure outstanding grain liabilities to producers by providing a bond, letter of credit, letter of guarantee, or payables insurance to the Canadian Grain Commission. If a licensed company fails to fulfill its payment obligations, the Commission utilizes the company’s security to compensate eligible producers.
Producers are entitled to compensation within 90 days from the date of their grain delivery or within 30 days from the issuance date of a cash purchase ticket or cheque, whichever is shorter.
In addition to providing compensation, the Canadian Grain Commission is collaborating with the receiver, Richter LLP, to recover proceeds from the sale of the company’s grain inventory.
Holders of outstanding primary elevator receipts may also receive a portion of these funds from the Canadian Grain Commission after the receivership process is finalized.
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