Discussions between the provincial government, grain handlers and Ontario’s farmers have concluded and deferred payments will now be permanently allowed under the Grains Act beginning July 1.
Grain Farmers of Ontario and the Ontario Agri Business Association have been working with the Ontario Ministry of Agriculture, Food and Rural Affairs and Agricorp for more than a year and a half to resolve the issue of deferring payments on grain. As a result, two regulations related to deferred payments, basis contracts and payments for grain sold out of storage have been brought up to date and approved by the provincial legislative committee and filed with the Registrar of Regulations in Ontario.
Chairman of Grain Farmers of Ontario Henry Van Ankum said, “This has been a rewarding process to go through. A problem was identified by farmers and the grain handling industry and we all pulled together including representatives from government to find a long term solution that will benefit everyone. The government should be commended for how quickly we have resolved this issue.”
The specific changes to take place on July 1, 2012 are:
– deferred payments will be allowed permanently in the Grains Act;
– all deferred payments under 180 days are eligible for declining coverage under the insurance provisions of the Grain Financial Protection program, and the dealer will simply be required to provide the producer requesting the deferred payment with written confirmation of the date on which the deferred payment arrangement was entered into, the date or dates on which payment is to be made, the amount of each payment and the total amount of all payments, the initial payment for basis contracts has changed from 75% to 60%, and elevators/dealers will have five trading days to pay for grain sold out of storage, which has changed the terms of payment from pm the next trading day to 2pm on the fifth trading day.
Deferred payments have become a significant item in the marketing tool box and are used by an increasing number of farmers across Ontario. For more information on the changes to the Grains Act, refer to the published regulations in The Ontario Gazette from May 19 or view the amending O.Reg. 260/97 (general) under the Grains Act at http://bit.ly/Kw5Bs4 and the new regulation O.Reg.
