As many of you know, House Enrolled Act 1483 passed during the 2021 Indiana Legislative Session that may impact Indiana grain farmers. I want to provide a brief reminder about our Indiana Grain Indemnity Program, its laws, and discuss what farmers need to know to continue to make their business a success.
The first thing I want to encourage producers to learn more about is the Indiana Grain Indemnity Program. This program is a separate entity from the Indiana Department of Agriculture’s Indiana Grain Buyers and Warehouse Licensing Agency. The agency’s role is to oversee the state’s roughly 220 licensed grain facilities, and the Indiana Grain Indemnity Program’s role is to help protect farmers financially in the event of a grain facility closure.
The indemnity fund was established to provide certain protections to grain producers who deliver their grain to a licensed grain buyer. In the event of a declared grain failure, payments may be made to farmers to fulfill a portion of the licensee’s grain obligations.
The law allows the indemnity fund to compensate farmers at a minimum of 80 percent of what they were owed from a licensed grain facility if a failure is declared. The 80 percent level is dictated by state statute, not our agency. The money available in this fund is made up of premiums that were collected from farmers during designated collection years. The last collection period ended in July of 2017, and the agency will not enter another collection period until the fund drops below $25 million.
The biggest change that will affect farmers from the recently passed legislation is that beginning on July 1, 2022, deferred priced contracts must be priced within the crop year the grain was delivered. A crop year is defined in state law and is the same definition as the USDA crop year. For corn, corn seed, soybeans and soybean seed a crop year is defined as Sept. 1 through Aug. 31. Wheat and wheat seed must be priced from June 1 to May 31.
Another thing I want to remind producers of is in the event of a grain facility failure, your grain is only covered for the 15 months prior to the date of a failure at a licensed facility, per Indiana statute.
As a final reminder, always know what you are signing and save your scale tickets, contracts, and settlement information. I encourage all Indiana grain producers to continually learn about the indemnity fund and what protection it offers to you and your business.
For more details on the Indemnity program or new law changes please visit isda.in.gov/grain.htm
