Organic Grain Buyer Files for Bankruptcy – Resources for Organic Farmers

On July 8th, Pipeline Foods filed for Chapter 11 bankruptcy. According to the company’s website, it contracted with 1,461 growers in 2019 (most recent number available).

If you are an organic grain producer who sold grain to Pipeline Foods and have not been paid, there are a couple of things you can do right now:

  1. Contact the state department of agriculture for the state where your grain was delivered. Many states have grain dealer licensing programs that administer funds or insurance programs to cover obligations from grain dealer defaults. Each state has its own program, so the details vary on how to apply and how much of the loss will be covered. The websites for programs in many of the states where Pipeline bought grain are listed below.
  1. If you delivered grain in a different state than where your farm is located, you may also want to contact your state department of agriculture to see if there are programs that cover this loss. Most states license the grain dealer, so they cover transactions at grain facilities in the state (where the grain is delivered, not where it is grown.) But it is also worth checking with your home state in case they have a program that could help. Some state programs may eventually hold information sessions about what options farmers have in this situation, so keep an eye on the websites for your state grain program.
  1. Consider seeking legal help if you made deliveries shortly before the bankruptcy filing, or before making any new deliveries to Pipeline (several states have suspended the company’s grain dealer license.) There may be steps you can take to impact your standing as a creditor in the bankruptcy process, depending on the terms of your agreement.

OFA will continue to look for other options for organic farmers who are impacted by this bankruptcy and will share more information as we find it. But contacting a state grain program and getting your own legal advice are short-term steps you should take as soon as possible.

State Programs

Illinois Grain Insurance Fund
https://www2.illinois.gov/sites/agr/Consumers/GrainWarehouses/Pages/Illinois-Grain-Code.aspx#h3

Indiana Grain Indemnity Program
https://www.in.gov/isda/divisions/indiana-grain-buyers/grain-indemnity-corporation/

Iowa Grain Depositors and Sellers Indemnity Fund
https://iowaagriculture.gov/news/notice-of-warehouse-grain-dealer-bankruptcy-07132021

Michigan Farm Produce Insurance Fund
https://www.michigan.gov/mdard/0,4610,7-125-1569_16993_16996—,00.html

Minnesota Department of Agriculture’s Grain Licensing Program
https://www.mda.state.mn.us/statement-minnesota-department-agriculture-regarding-pipeline-foods-llcs-chapter-11-bankruptcy
****Minnesota Grain Program held a (virtual) public information session about this bankruptcy on Weds. July 21 at 1-3 pm central. Click here to watch a recording of the session.

Missouri Grain Regulatory Services Program
https://agriculture.mo.gov/grains/?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term=
Please contact the Missouri Department of Agriculture if you or your business have any unsettled obligations with Pipeline Foods, LLC. You may call Grain Regulatory Services Program Manager Eric Berwanger at (573) 751-4112.

North Dakota Grain and Livestock Licensing Division
https://www.nd.gov/ndda/program/grain-inspection
ND Grain Complaint Form: https://www.nd.gov/ndda/submit-grain-complaint

Ohio Grain, Feed & Seed Program
https://agri.ohio.gov/wps/portal/gov/oda/divisions/plant-health/grain-warehouse-feed-and-seed/grain-feed-seed     (choose Grain Indemnity Fund button)
Claim forms: https://agri.ohio.gov/wps/portal/gov/oda/divisions/plant-health/forms/plnt_4203-006

South Dakota Public Utilities Commission Grain Warehouse Program
https://puc.sd.gov/warehouse/
Producers who are not being paid in a timely manner are encouraged to report problems to the PUC by calling 1-800-332-1782 or sending an email to puc@state.sd.us

Wisconsin Agricultural Producer Security Default Claims
https://datcp.wi.gov/Pages/Programs_Services/AgProdSecDefaultClaims.aspx