Record Compensation for Unpaid Producer Deliveries to Purely Foods

A new record of more than $17 million has been paid out in compensation to Prairie producers for unpaid deliveries after the Canadian Grain Commission (CGC) yanked the grain dealer and elevator licences of Purely Foods Canada last year. 

The CGC said Thursday a review of individual claims submitted by producers found there were 78 eligible claims for unpaid deliveries to Purely, all of which have now been 100% covered under the commission’s Safeguards for Grain Farmers Program. The total compensation amount was the most in the program’s history, it added. 

Purely Canada Foods Corp. held a grain dealer licence and three primary elevator licences for facilities located in Avonlea, Kindersley and Lajord, SK. The CGC revoked all the company’s licences in August and ordered the company to stop buying grain from producers. 

The CGC said it also received multiple claims that could not be compensated because the deliveries fell outside of the program eligibility period. The commission said it is advocating for producers still owed money and encouraging them to seek payment directly from the company. No dollar figure was given for those claims that could not be compensated. 

The 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 Canadian Grain Commission as a bond, letter of credit, letter of guarantee, or payables insurance. If a licensed company does not meet its payment obligations, the Canadian Grain Commission uses the company’s security to compensate eligible producers. 

Producers are eligible for compensation within 90 days from the date of their grain delivery or within 30 days from the date a cash purchase ticket or cheque was issued to them. The lesser of the two time periods applies.