Producers who were not paid for grain delivered to LSM Grain Ltd. will be fully compensated for their eligible claims.
In a release Thursday, the Canadian Grain Commission (CGC) - which pulled the gain dealer licence of Saskatoon-based LSM back in July - said it determined there were 9 eligible claims totalling over $395,000 for unpaid grain deliveries. Producers with eligible claims will receive 100% compensation from the company’s $2-million security, the CGC said.
However, the CGC said it also received 17 claims that could not be compensated because the deliveries fell outside of the 90-day eligibility period.
“We are pleased to provide 100% compensation to producers with eligible claims. If producers are having difficulties getting paid, we encourage them to contact us immediately and we will do everything we can to help them through our Safeguards for Grain Farmers Program,” said David Hunt, Chief Commissioner, CGC.
The CGC’s Safeguards for Grain Farmers Program regulates grain companies to mitigate the risk of payment failure to producers and to support the grain quality assurance system.
As a condition of licensing, licensed grain companies are required to tender security for outstanding grain liabilities to producers to the CGC as a bond, letter of credit, letter of guarantee, or payables insurance. If a licensed company does not meet its payment obligations, the company’s security is used to compensate eligible producers.