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2008 Policy Book

#32 PAYMENT PROTECTION FOR GROWERS

Farmers need maximum assurance of payment for commodities delivered. When a buyer becomes insolvent or declares bankruptcy, many people suffer. The impact on farmers is more significant because of the perishability and the seasonal nature of many commodities.

Lumper fees shall not be charged for products meeting the USDA "Good Delivery" standards.

We support legislation to assure growers receive secured position and full payment for commodities delivered. Successful examples of payment protection mechanisms used by the dairy, grain and livestock industries include licensing, bonding, and producer insurance funds.

We recommend exploring all possible options, including amending the Uniform Commercial Code, to assure full secured position payment for commodities delivered.

We encourage Michigan Farm Bureau to support an industry coalition to evaluate options for improving Michigan Department of Agriculture security positions in the event of licensed grain elevator failure.