Arkansas governor signs Grain Dealer Act to regulate brokers

Arkansas governor signs Grain Dealer Act to regulate brokers

“Finding ways to help farmers avoid financial calamity is important to all commodities, and this new law is an important step in that ongoing effort," said Dow Brantley, a farmer and chairman of Arkansas Rice Farmers. "The Arkansas Grain Partners Act takes reasonable steps to provide more information and tools to farmers when considering their marketing options.”

Arkansas Gov. Asa Hutchinson has signed legislation requiring all grain dealers in the state to be licensed with the State Plant Board and demonstrate “adequate levels of creditworthiness” when buying grain from farmers.

The legislation, the Arkansas Grain Dealers Act of 2015, is aimed at preventing a recurrence of situations like that in which growers reportedly lost millions of dollars on grain crops sold to an Arkansas-based grain company – often with only a handshake.

Besides the licensing and credit requirements, grain dealers will have to maintain records of grain purchases and sales and make financial records available for annual reporting and auditing. The State Plant Board will provide the regulatory oversight to conduct audits, suspend licenses and can shut down dealers who are out of compliance with the new law.

“Finding ways to help farmers avoid financial calamity is important to all commodities, and this new law is an important step in that ongoing effort," said Dow Brantley, a farmer and chairman of Arkansas Rice Farmers. "The Arkansas Grain Partners Act takes reasonable steps to provide more information and tools to farmers when considering their marketing options.”

What can be done about Turner Grain?

According to reports, Turner Grain Merchandising, Inc., a company based in Brinkley, Ark., bought grain from farmers in Arkansas, Louisiana and Mississippi and sold it to buyers like Tyson Foods for use in animal-feeding operations.

Last summer, reports began circulating that Turner had failed to pay for some of the grain it had agreed to purchase from growers or that checks used to pay farmers for their grain had not been honored. Estimates of the dollars involved have ranged from $30 million up to $100 million.

Dale Bartlett, one of the partners in Turner Grain, has filed bankruptcy for U.S. Bankruptcy Court in the Eastern District of Arkansas. He has declined requests for interviews.

Another bill, which would have established an indemnity fund to protect grain producers using state research and promotion dollars, was rejected by the Senate Agriculture Committee earlier this year. It was opposed by some commodity groups.

The Grain Dealers Act was supported by the Agricultural Council of Arkansas, Arkansas Farm Bureau and other agricultural groups in the state.

The State Plant Board has said it will begin receiving comments when it begins the rulemaking process for the new law, Act 601 of 2015, in the next few weeks.

For more information, visit http://www.feednavigator.com/Regulation/Rabo-AgriFinance-sues-failing-US-grain-brokerage-farmers-also-allege-fraud

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish