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National exposé is not a balanced view: MPC

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The Manitoba Co-operator | December 13, 2012 7<br />

FARMERS SUE Continued from page 1<br />

“Some people compared the losses of farmers<br />

to the losses of investors, but that’s different.<br />

The investors made a dec<strong>is</strong>ion to take th<strong>is</strong> r<strong>is</strong>k,<br />

but people selling their grain thought they were<br />

bonded and just doing business.”<br />

DOUG CHORNEY<br />

said John Sigurdson, a Riverton<br />

farmer and spokesman for the<br />

group. “We’re <strong>not</strong> saying who<br />

because we don’t know for sure<br />

ourselves. We’re at the early<br />

stages of (determining) that<br />

right now.”<br />

Puratone, which operates<br />

about 50 hog barns in Manitoba<br />

and three feed mills, filed for<br />

creditor protection Sept. 12,<br />

owing creditors around $100<br />

million, including $86 million to<br />

three lenders, which are secured<br />

creditors.<br />

Maple Leaf Foods has since<br />

offered to buy the company’s<br />

assets for $42 million — well<br />

short of what <strong>is</strong> owed. And<br />

because it bought Puratone’s<br />

assets, and <strong>not</strong> the company<br />

itself, Maple Leaf <strong>is</strong> <strong>not</strong> responsible<br />

for paying the outstanding<br />

bills for grain.<br />

In a bid to find some money<br />

for the farmers left on the hook,<br />

Keystone Agricultural Producers<br />

invited the players in the affair<br />

to a closed-door meeting last<br />

week. Officials from Puratone,<br />

Maple Leaf Foods, the Manitoba<br />

Pork Council, Farm Credit<br />

Canada, and an affected farmer,<br />

Kyle Foster of Arborg, took part.<br />

Representatives from Deloitte<br />

and Touche, Bank of Montreal<br />

and the Animal Nutrition<br />

Association of Canada, who represent<br />

feed mills, were invited<br />

but didn’t attend.<br />

To encourage frank d<strong>is</strong>cussion,<br />

participants agreed <strong>not</strong> to<br />

d<strong>is</strong>close details but when asked<br />

if the meeting clarified where<br />

the affected farmers stand, KAP<br />

president Doug Chorney replied:<br />

“No.”<br />

“I tried <strong>not</strong> to create false<br />

hopes, but th<strong>is</strong> <strong>is</strong> something we<br />

had to try,” said Chorney. “At the<br />

very least he (Foster) had the<br />

opportunity to speak h<strong>is</strong> mind<br />

and all these stakeholders would<br />

hear what happened to the<br />

farmers. That’s important.<br />

“Some people compared the<br />

losses of farmers to the losses<br />

of investors, but that’s different.<br />

The investors made a dec<strong>is</strong>ion<br />

to take th<strong>is</strong> r<strong>is</strong>k, but people<br />

selling their grain thought<br />

they were bonded and just doing<br />

business.”<br />

“There wasn’t a lot to be<br />

said,” added Foster. “Obviously<br />

nobody wrote us a cheque.<br />

It was good to see them come<br />

around the table and good that<br />

they heard us out.<br />

“We were kind of hoping to<br />

hear some better news out of<br />

that meeting Monday so I guess<br />

we’ll be going ahead with a<br />

lawsuit.”<br />

So far 20 of the estimated<br />

30 affected farmers have<br />

agreed to explore a lawsuit,<br />

Sigurdson said. They are owed<br />

an estimated $960,000, but must<br />

decide if going to the courts will<br />

be worth the time and expense,<br />

Sigurdson said.<br />

“Our lawyer has already<br />

told us th<strong>is</strong> could take us two<br />

years, but we’re <strong>not</strong> going to let<br />

th<strong>is</strong> go un<strong>not</strong>iced,” Sigurdson<br />

said. “We’ve depleted all outside<br />

forces to get any financial<br />

aid. We’ve gone to every possible<br />

thing we can think of and it<br />

hasn’t got us anywhere.”<br />

It’s particularly frustrating<br />

that those who delivered feed<br />

after Puratone sought protection<br />

under the Companies Creditor<br />

Arrangement Act were paid, but<br />

<strong>not</strong> those who delivered in the<br />

15 days prior.<br />

“All of a sudden when they go<br />

into CCAA protection, the Bank<br />

of Montreal was able to step up<br />

with $11 million to pay for feed,”<br />

Sigurdson said. “Anyone who<br />

delivered on Sept. 12 or after has<br />

been paid the next day.<br />

“I think they think we’re just<br />

going to fade away into the<br />

background, but we refuse to be<br />

pushed away.<br />

“We delivered the grain in<br />

good faith. It got used up and<br />

fed straight to their hogs. In reality<br />

you could say they stole our<br />

grain. They had no intentions of<br />

paying for it.”<br />

Sigurdson and h<strong>is</strong> brother<br />

Frank are owed $63,000. It’s the<br />

second major blow he’s suffered<br />

th<strong>is</strong> year — on Aug. 1, 1,200 of<br />

h<strong>is</strong> 4,000 acres were wiped out<br />

by hail. Sigurdson didn’t have<br />

hail insurance and h<strong>is</strong> crop<br />

insurance payout was offset<br />

by good yields from fields that<br />

didn’t get hail.<br />

Chorney said he hopes such a<br />

situation can be avoided in the<br />

future. H<strong>is</strong> organization would<br />

like to see the Canadian Grain<br />

Comm<strong>is</strong>sion expand its grain<br />

security program, which now<br />

only applies to grains named<br />

in the Canada Grain Act and<br />

delivered to CGC licensed facilities,<br />

to feed mills. The CGC <strong>is</strong><br />

in the midst of revamping the<br />

program, which obliges grain<br />

buyers to post security to cover<br />

what <strong>is</strong> owed to farmers for their<br />

grain.<br />

allan@fbcpubl<strong>is</strong>hing.com<br />

China says threats<br />

to harvests grow<br />

The country’s food security <strong>is</strong> threatened by<br />

limits to agricultural growth<br />

BEIJING / REUTERS<br />

China’s food security <strong>is</strong><br />

under greater threat<br />

as its agriculture faces<br />

growing land, water and<br />

labour shortages over the next<br />

decade, the country’s agriculture<br />

min<strong>is</strong>ter said Nov. 9.<br />

Th<strong>is</strong> year <strong>is</strong> expected to be<br />

China’s ninth consecutive<br />

year of r<strong>is</strong>ing grain output, but<br />

experts have warned it might<br />

struggle to continue improving<br />

yields, despite a campaign<br />

aimed at consolidating, mechanizing<br />

and commercializing<br />

its farms.<br />

“The next five to 10 years are<br />

a key period for the development<br />

of China’s agriculture<br />

sector — with production<br />

factors like land, water and<br />

labour getting tighter,” said<br />

Han Changfu at a session of<br />

the ruling Commun<strong>is</strong>t Party<br />

congress in Beijing.<br />

“Agricultural production <strong>is</strong><br />

facing greater r<strong>is</strong>ks — natural<br />

r<strong>is</strong>ks, market r<strong>is</strong>ks, security<br />

r<strong>is</strong>ks — and it <strong>is</strong> entering<br />

a period of high investment,<br />

high costs and high prices.”<br />

Han said China continued<br />

to expect bumper harvests th<strong>is</strong><br />

year despite a global decline in<br />

agricultural production.<br />

Soaring food demand from<br />

an increasingly prosperous<br />

population has piled the pressure<br />

on China’s pastures, but<br />

growing rates of urbanization<br />

and the encroachment of<br />

industrial projects on precious<br />

farmland have also added to<br />

the problems.<br />

Han said China would continue<br />

to press for the aggregation<br />

and mechanization of the<br />

farms in order to stave off the<br />

problems caused by decreasing<br />

acreage and the declining<br />

rural workforce.<br />

“Beijing will breed a new<br />

type of agricultural player and<br />

develop large-scale mechanized<br />

farming,” he said.<br />

In a speech at the same<br />

session, China’s Land and<br />

Resources Min<strong>is</strong>ter Xu Shaoshi<br />

said the country plans to<br />

restrict the amount of new<br />

land being taken over by<br />

industry, and would also seek<br />

to avoid encroaching upon<br />

farmland.<br />

A woman sits on a pile of corn as she removes the husks on a road located on the outskirts of Beijing. PHOTO: REUTERS/DAVID GRAY<br />

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