The farmers should have listened to Drakes ;-) I do feel sorry for them though. It's one thing to lose money in an investment it is another be screwed out of your livelyhood money. Here is more local news. It's interesting what they have to say about the warehouse law....
Farmers told to hire lawyers
Ag Department can do little in AgriBioTech bankruptcy
By Dusty Parnell - Idaho Press-Tribune
BOISE ? One of the major seed companies in the country filed for bankruptcy and today?s advice to growers from the state Department of Agriculture is see a lawyer.
AgriBioTech filed for Chapter 11 reorganization bankruptcy in Nevada on Tuesday and it could affect a couple hundred growers in Idaho who are owed millions of dollars for alfalfa and clover seed they grew last year. Alfalfa seed is one of the strongest cash crops in Canyon County.
?This is a very serious situation and one we?re taking very seriously,? state Department of Agriculture Deputy Director Mike Everett said. ?I guarantee no stone will be unturned.?
Director Pat Takasugi excused himself from talking about the issue because he holds seed contracts with AgriBioTech.
Everett said the department has received several calls from producers, but since there is little the department can do, the issue will be resolved in court.
The only aspect of the bankruptcy that relates to the Idaho Department of Agriculture is the bonded warehouse law ? a licensing program. AgriBioTech has a $500,000 warehouse bond with the state and is licensed to do $19 million worth of business with Idaho producers.
Because of the warehouse law, the Idaho Agriculture Inspections Division has the right to review warehouse records and sales receipts. Administrator Lane Jolliffe said the division will verify that warehouse storage matches company records.
If the records do not match, inspectors can demand a 48-hour notice to the company to comply with stated records. The division also has the authority to seize the warehouses if necessary. The division has made three such seizures in the past decade.
Seed payments to the producers are usually made in December, January and into February, but apparently only partial payments have been made to producers who requested payment in December.
?They could either take it then or wait it out,? Rick Waitley of the Idaho Alfalfa Seed Growers Association said. ?And that type of settlement is not unusual.?
The association will meet Tuesday with an attorney to discuss the situation.
Until the case is settled in court, there will be many unanswered questions.
?Short term it?s going to be bad until something else materializes with another company or until this company becomes more stable,? grower Ray Gross of Wilder said.
?Declaring bankruptcy might be the best thing that could have happened,? vice-president and ag lender Alan Bullard of U.S. Bank in Caldwell said. ?It might ensure they get paid at some time.?
The bankruptcy comes at a bad time because farmers need their payments and contracts in hand for a new growing season and lending package.
Bullard doesn?t see banks or farmers panicking yet, and he said banks will likely give the situation time to work itself out.
?I don?t see it putting anyone out of business necessarily,? Bullard said. ?There would have to be some other ills there ? someone down to the last straw already.?
Growers meeting
Seed growers are invited to attend the Idaho Alfalfa Seed Growers Association at 3 p.m. Tuesday at the DoubleTree Hotel Riverside, 2900 Chinden Blvd., Boise. A bankruptcy attorney will be on hand to answer questions. |
