Saskatchewan Association of Rural Municipalities (SARM) president Ray Orb call on grain companies to reduce penalties and eliminate administration fees on contracted but undeliverable grain for this year.

Orb expressed his concerns in a press release sent out on Monday.

He said grain volume is down and many farmers are struggling to meet their commitments on their contracted but undelivered grain.

“We need the grain companies to work with farmers on this issue,” SARM President Ray Orb said in a release.
“A lot of farmers simply don’t have the grain this year due to the drought and with no ‘Act of God’ clause in some of the contracts, prices have continued to climb and the cost to buy out those contracts is now substantially higher.”

Orb said farmers are now faced with trying to buy back forward priced contracts, which includes penalties and administration fees, on this grain.

SARM is calling on grain companies to be more flexible with farmers this year. He said the administrative fee is meant to deter growers from trying to get out of a contract when they actually have the physical grain in order to capture a slightly higher price.

The costs depend on the commodity and the type of contract a farmer has. It is variable across the board.

“It is imperative that we stand united in supporting our farmers,” Orb said. “SARM remains committed to ensuring a resolve to this issue.

“We are urging the Western Grain Elevator Association and its members to work with farmers struggling to pay penalties and administration fees on contracted but undelivered grain.”