Ag Clearing Insert in the Western Producer

[parsley]

Such clear information.

Thank you.

Parsley

[TOM4CWB]

Padron,

My word is my bond.

The majority of grain growers are exactly the same way as I am.

When a S-Bee leaves my yard.... I am often a month without seeing a cent. No official paperwork.

The CGC requires Grain-co's to pay me... and pay fair... or it is FRAUD.
They, because they are licensed, and security is part of that license... are required to pay me under the CGC Act within 90 Days.

Trucks are moving interprovincially and internationally.

Good luck... tracking your load down... and paying the legal fees trying to collect... with no CGC Act to back up your rights as a grain grower to that grain!

RISK.

We would think it is smart... to save $1M/yr. to Risk $$$ Billions like happened in Enron and Worldcom?

Where the $b's are.... without regulation... involving trusting and caring folks like grain growers...

WE are perfect objects for SCAMs and Thieves... and the most vulnerable of any segment of Canadian society to unscrupulous people... simply because our word is our bond as grain growers... and we naturally expect others to be like we are.

This is why the CGC Act has had security in it... for over 100 years.

We both know this Russ... now lets do the right thing!

Russ; Go after the 20mmt of unbonded grain... and prove the system works in this market!

Domestic sales are at risk just as much... and CGC exempt in just about all cases!

If we can make this system function well here... then we can consider International Grain Trade!

[TOM4CWB]

Tom
still at a bit of a loss for your concerns. AgClearing may not fit your needs. It won't cost you a cent if you choose not to participate in it. If you choose to use your word as your bond on a deal, as I have too, then you know your buyer and have that level of trust there.
AgClearing will work excellently into the future where more and more producers choose to market their own grains. By having the support of the financial institutions knowing that the clearing house 100% secures the contract, will free producers from the risk of a lost truck, or complete transaction failure.
For you Tom it might not be an answer, for a solution to the removal of bonding under the CGC I believe it is an excellent choice.
Erik

[Kodiak]

Tom4CWB

Would you sell grain or a specialty crop to a buyer who:

1) For reasons that are not apparant, is offering a significantly higher price than other buyers?
2) Refuses to clear the transaction through a clearing house such as the one discussed here?
3) Is managed by someone you did not know, or is new to the business?

[charliep]

Just a couple of couple of other thoughts.

Has anyone thought about the risk side of transactions in today's environement. A "B" train of feed barley is worth about $8,000. A "B" train of canola is worth about $25,000. If red lentils are worth 40 cents/lb, a "B" train is worth about $35,000.

On the paperwork, I assume the paperwork will only be critical if there is a dispute. What steps do you take today to document sales agreements/contracts? Who writes the contracts/sets the terms? What will be different with the clearing house except that more rigor and process will have to be applied including registering the trade? With the improve confidence in contract execution(both for you and your banker), maybe the extra (perhaps discipline and rigor) will be worth it?