Financial failure of grain elevators hurting Texas farmers

In rural parts of Texas over the past two years, when 16 grain elevators - some full of corn, sorghum, wheat and other grains - abruptly went bankrupt or failed. The nine grain companies that owned the elevators fell victim to the national economic recession, according to the Texas Farm Bureau. Hundreds of farmers statewide have been left clinging to their livelihoods as several million dollars in unsold grain became locked inside the storage facilities, the Farm Bureau said. Several farmers lost tens of thousands of dollars, and many more lost hundreds of thousands.

The Farm Bureau has identified the solvency of grain elevators as a major issue facing the state's farmers, and it wants lawmakers to address it in the upcoming legislative session. One of the largest elevators to fail was in Sherman in 2009. Ben Wible said he lost about US$80,000 worth of milo and corn when Dorchester Grain Co., owned by John Chumbley, was closed.

Bryan Black, a spokesman for the Texas Agriculture Department, said the department shut down the operation after inspectors found that the company's ledgers didn't add up. They uncovered a shortage of 648,000 bushels of grain, worth US$4.9 million at current prices. The department also wouldn't let any grain into or out of any of the company's seven facilities in Texas, which could hold more than 4 million bushels. Read more...

This blog is written by Martin Little The Global Miller, published and supported by the GFMT Magazine from Perendale Publishers.