Cranston grain, Trevor Schulz, screws farmers

[TOM4CWB]

Farmaholic,

The cost of producer security is ALREADY in the basis
now today... for Licensed and Bonded
dealers/elevators under the Canada Grain Act. My
understanding is the new insurance producer security
program is an alternative to the CGC system... for
growers to use with security approved (by the six
insurance co's) who approve grain buyers... that are
not Licensed under the CG Act.

Will be great to see the program roll out in the next
few weeks I am told.

[Rareearth]

It better not be a financial advantage for large
companies over the smaller ones. If that was to
happen there would be even less price discovery,
and few delivery options in the future. Don't give
the big guys the opportunity to buy the market, or
they will, seems to be major consolidation
already, future options will be limited. Won't
matter what competition bureau thinks.

[hobbyfrmr]

I am more than happy to do my own diligence for
my own farm/business. I will pay the cost. It's a
minuscule amount compared to pissing tens of
thousands of dollars into the wind.
A working man/ woman gets up in the morning,
and goes to work every weekday for six months to
earn $30,000.
Farmers won't even pick up a phone, or click a
mouse 4 times to look after their own sales, and
then complain on a public forum that the
responsibility, and cost for their due dilligence
belongs to somebody else.
Are you guys for real?
I think I am in an episode of Seinfeld.

[hobbyfrmr]

Tom4,
The insurance program works excellent. Accounts
recievable insurance has been available in the
business world for decades. I started with it in
2006. One bad credit check ( no sale) and no
defaults. I have done over 2 million dollars in
value of sales.. This is why I have been
encouraging it on AV since October. The insurers
participating in the program you describe also
cover export sales for line companies and the
cwb. Ironically, farmers have difficulty seeing
value in it!

[malleefarmer]

You guys should check out cleargrain.com.au
Basically eBay for grain with payment security

Tom4cwb know how it works and is skilled up on
it

[wd9]

Hobbyfarmer, for sure there are avenues
to protect yourself. We are not as dumb
and lazy as you suggest, however my
point is where do you start drawing the
line?

At 10k? 30K? All loads? For me its
simple going forward, i'm gonna get
paid. Its gonna cost a little bit and
that's ok.

But calling me a loser and lazy isn't
very nice. The lesson for me has been
nobody knows the financial state of
anyone anymore. No one can be trusted.
Regardless of contract size, and who it
is, be protected.

Here's an interesting question. How many
of you actually have signed contracts
every time by both parties? Often its a
phone call and confirmation. Will
insurance cover unsigned contracts?
Nope. Can you confidently go to court
without one, nope. More tough lessons.

[LWeber]

"Cranston Grain was told by the CGC that he did not need to be bonded."

This is illogical if the company was buying farm grain. Is this fact or coffee shop talk?

[HappyFarmer]

My thoughts exactly Larry. That
statement make absolutely no sense.
Maybe that is coffee shop talk or maybe
that's a statement Cranston Grain is
using as a excuse. Either way, it's not
true. My best guess would be that
Cranston decided not to get bonded by
the CGC because of the cost associated
with getting the bond level that the
needed. The CGC has never, nor will they
ever tell a buyer who is buying grain
from a Canadian farmer that they don't
need to be bonded.

[Burbert]

Motto of new grain insurance company.
"When a claim is received, deny, deny,
deny, framers are sooo stupid they'll just
walk away, mumbling bout it." Nother way
ta screw framers, angribusiness at its
best!

[AlbertaFarmer5]

Unfortunately,I got to meet Trevor when
this first surfaced. I'm sure there are
more sides to the story, but this was
his side:
He purchased/contracted, then resold a
bunch of grain from farmers before the
run up in prices. Fall came, the price
went up, and many of the farmers refused
to deliver at the lower prices, so he
had to buy grain at higher market values
to fill his obligations. Combined with
being late in getting paid by some of
his clients, everything snowballed from
there. I also understand that he was on
the wrong side of the Newco default as
well. Not justifying what happened,
just filling in what I know, and as I
say, only one side of the story.
However, there were many lies about what
was going on. I will say it looks like
a lot of assets in a fancy home and
vehicles, but there could be no equity
in either. After asking around, almost
none of the brokers around here are
bonded, my new policy is selling one
load at a time if the broker isn't
bonded, I can't afford a hit like wd9
had.

[hobbyfrmr]

Wd9,

I don't know you personally. I am not calling a
loser. Where did I call you a loser? I was
generalizing. I have been actively farming for 23
years. pubs, coffee shop, producer meetings,
local elevators, inland terminals. there is one
obvious underlying theme. The majority of
Farmers are lazy marketers. Watch how farmers
try to get every little perk out of suppliers, and
how they get people to run around for them and
do the most important parts of marketing, grading
and sampling for them. It's all because they don't
want to spend a thousand bucks to know what
they have . It is really sad. The truth hurts. Lies
don't hurt. I had to learn that myself.
GM or John Deere doesn't have the farmer pay
for Nebraksa Tractor testing before he buys the
tractor. They have that documentation on hand to
show and promote to the buyer.
Buying or selling grain with unsigned contracts is
a shining example of lazy business ethics. There
is the perfect recipe for getting screwed or having
to go into collections. Who does this in the
business world? Farmers. Who allows it to
happen? Buyers. Why? Open ended contract, let
the games begin.
If you (not you specifically WD9 , generally
speaking to forum) want to participate in the
insurance program Tom is describing, you will
have to present documents to insurer. Signed
contract (both parties names on it), volume, price
grade, FOB.
This confirms the agreement, so if necessary, the
a/r insurance company can goto collect from
defaulted buyer. Meanwhile you have 90% of your
money. Not perfect, but its better than 0% and
going to hire a lawyer.



Verbal accounts/deals mean nothing in the
business world. Only a contract signed by both
parties is valid in a court of law.

[grainboy]

WD9 has agood point, in this industry most deals are done with a phone call, a verbal agreement... and a contract may follow by mailor fax... but one you agree to it on that call is a done deal..

[wd9]

Oh i agree hobby, and that is the way.

BUT, I am going to do that with ALL
transactions going forward, no matter
the size. The whole purpose of putting
this embarrassing event forward in
public. Awareness and letting others
know that if you don't, you're probably
gonna have the same story to tell.

Trevor told me that CGC said he never
needed to be bonded. Says he has the
docs to prove it. His word means nothing
at this point.

[charliep]

Telephone calls/acceptance should always be made subject to contracts being delivered and signed. Also realize there is often more to the contract than the one page on the back of the signed page that provides specific volume, quality and quantity data. That one page often refers to other documents that go into greater detail.

[LWeber]

http://laws-lois.justice.gc.ca/eng/acts/G-10/page-11.html#h-19

carry on business as a grain dealer unless

(i) that person is the holder of a grain dealer’s licence,

(ii) the business of that person as a grain dealer has been exempted from the licensing requirements of this Act pursuant to section 117, or

(iii) that person deals in grain only in the course of operating a licensed elevator or as a broker trading on a recognized grain exchange.

117. Where, in the opinion of the Commission, the control of any type of elevator or type of grain handling operation or any particular elevator or grain handling operation is not essential for maintaining the quality, safe-keeping and orderly and efficient handling of grain in Canada, the Commission may,

(a) by regulation made with the approval of the Governor in Council, exempt that type of elevator or operation from the licensing or any other requirements of this Act or the regulations, or

(b) by order, exempt that particular elevator or operation from the licensing or any other requirements of this Act or the regulations,

on such conditions and for such period as may be set out in the regulation or order.