Saskatchewan Ag Groups Seek Change in Grain Contracts

Jul 13, 2022

Less than half of Saskatchewan farmers believe they are being treated fairly in grain contracts, the results of a new study show.

Carried out by Mercantile Consulting Venture Inc., the study was commissioned by SaskCrops and the Agricultural Producers Association of Saskatchewan (APAS) in response to rising concerns amongst Saskatchewan farmers around the transparency of grain purchase contract terms and conditions between farmers and grain buyers.

Released earlier this week, the study found only 46% of Prairie grain farmers feel they are getting a fair shake when it comes to their grain contracts. Several concerns about the contracts were raised, including too many terms and conditions that are difficult to understand, as well as the fact company buying agents are often unable to explain the terms themselves when asked to do so by farmers.

The study suggests improving grain contracts for Saskatchewan grain farmers will benefit not only farmers, but also grain companies and the entire industry, said APAS President Ian Boxall. To that end, the report also outlines several possible solutions to improve clarity and balance between farmers and grain buyers, such as the development of a simple and clear standardized contract.

“We aren’t looking to reallocate production risk from farmers to grain companies, but instead to clearly define contract terms and conditions so everyone understands their responsibilities if they are unable to fulfill the contract,” Boxall said.

Farmer concern around grain contracts was heightened by last year’s growing season, when many producers were caught between their grain contracts and not enough production to fulfill them because of severe drought. In some cases, farmers faced hefty financial penalties they could ill afford. Concerns around grain contracts were raised throughout farm organization annual general meetings in 2021-22.

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