Soybean drying charges
FROM THE CEO'S DESK
IN AUGUST 2013, the grain industry, including Grain Farmers of Ontario, agreed to change to a system where the cost of drying soybeans was not regulated. Cleaning and handling charges, as well as soybean drying charges and moisture discounts, would be agreed upon by the dealer and producer through competitive market forces — similar to the systems used for corn and wheat.
Previously, charges were calculated based on the cost of soybeans and not the cost of the service. There were also several different ways companies would calculate how they came up with the costs. Grain Farmers of Ontario directors and staff would often get complaints from farmers about concerns they had with the system. However, we never heard any complaints about the deregulated system used for corn and wheat. Given that corn especially is dried significantly (80% of the crop is dried), it was deemed this would be a good model to follow.
Five years later — we are still getting complaints about soybean drying charges.
Any new system takes time to implement and get the bugs worked out — but we should be at the point now where deregulated soybean charges are working as smoothly as those for corn and wheat. However, resolutions continue to be brought forward by our delegates during our semi-annual and annual meetings about the need for soybean drying charges to be more transparent and consistent.
One frustration is that some companies continue to use their old conversion charts of years’ past to calculate their drying charges and it’s difficult to compare the charges from one company to another.
We will continue to have discussions with grain companies to discuss with them how to make this ‘new’ system more transparent so that everyone understands how soybean drying charges are being calculated. Farmers are their customers, and if the customer can’t understand what they are being charged, it’s not a good relationship.
We are preparing for our 2018 AGM this month, and we expect to see resolutions brought forward which reflect the issues most important to our farmer-members — the need for fair science-based regulations, the need to fight for better business risk management programs, the need to increase our research efforts to improve our agronomic practices. Some issues come and go; but this seemingly lack of transparency for soybean drying charges seems to linger on. •
