‘It’s pretty dire’: Manitoba farm group urges lower grain elevator fees amid drought

A Manitoba farm advocacy group is urging grain handlers to consider reducing — or even eliminating — grain elevator fees in light of the immense financial strain the drought has put on producers.

Keystone Agricultural Producers general manager Brenna Mahoney says they’ve sent a letter to the Western Grain Elevator Association (WGEA) to encourage its members to lower administrative fees during what has been “a really difficult year.”

“It has been labelled a crisis, so that’s where (farmers) are not getting the yields that they need to meet the contractual obligations that they set earlier in the year,” says Mahoney.

“We do encourage the grain companies to examine those administrative fees; that would be an easy win right now with those producers to help them out, which is exactly what we’re looking for.”

Read more: Manitoba, federal governments scramble to roll out support for agriculture producers amid drought

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The fees themselves vary widely, Mahoney says, depending on the volume of crop and the terms of each contract, and can range from $500 to $50,000.

She appreciates that the request is a “challenging ask,” but says the situation right now is dire.

“We are in a commercial industry, this is about marketing, so it is a delicate ask, but we absolutely want to represent our producers in these discussions,” Mahoney says.

“Especially because those relationships between the grain elevators and producers is so important, and many of them are very long-term, like 30-plus years. So we know that they’re always looking for solutions on those relationships, and this reduction or removal of those admin fees would help with that.”

The situation is much the same for Manitoba’s western neighbours, with the Agricultural Producers of Saskatchewan recently submitting a similar request to the WGEA, to provide some relief to farmers unable to fulfill grain contracts amid the drought.

Click to play video: 'Contract concerns mount as harvest produces low yields for some' Contract concerns mount as harvest produces low yields for some

Contract concerns mount as harvest produces low yields for some

“It’s being looked at with serious weight by different grain companies, but how we ultimately decide to react to that is going to have to be up to each company individually in a competitive environment,” Wade Sobkowich, executive director of the Western Grain Elevator Association, told Global News.

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In the meantime, Mahoney is encouraging producers to talk to their grain handlers themselves to see if adjustments can be made.

“Go talk to them about your contracts. They are looking at this on an individual basis as well … there are things that could potentially happen now with your contract today,” Mahoney says.

Read more: Manitoba agriculture sector turns to Ottawa for more support

Harvest 2021

According to Manitoba Agriculture, this year’s harvest is about 35 per cent complete, advancing five per cent in the last week.

Manitoba Agriculture crop specialist Dane Froese says it was a bit of a slower week due to rain, humid weather and delayed harvest operations.

In conversation with 680 CJOB, Froese says the crops look “as good as could be expected, given the drought conditions and severe weather we’ve faced this year.”

Read more: Manitoba farm groups urge producers to explore alternative uses for crops as drought continues

“Wheat yield is somewhat better than expected, with yields typically averaging in the mid-forty bushel-an-acre mark, which was slightly better than what folks were thinking given how dry it was,” Froese said.

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“Oats on the other hand did poorly … canola right now is highly variable, and that’s what most farmers are. We’re seeing anything from five to about 55 bushels on the upper end. Most tend to be between 15 and 25 bushels-an-acre; really depending on where those thundershowers came.”

Froese expects it’ll take about another month for harvest to wrap up.

-With files from Connor O’Donovan

© 2021 Global News, a division of Corus Entertainment Inc.

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