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Grain Licensing

New Legislative Changes

On April 29, 2021, House Enrolled Act 1483 was signed into law by Governor Eric J. Holcomb.  This act amends certain licensing and operating requirements within the Indiana Grain Buyers and Warehouse Licensing and Bonding Law [Indiana Code 26-3-7].  Because an emergency was declared for this act, all amendments immediately took effect upon Governor Holcomb’s signature, and are statutory requirements all licensees must adhere.  A synopsis of each new statutory requirement is outlined directly below.  All licensees are expected to implement these new statutory requirements into their standard business policies and procedures accordingly.

Please contact the agency by phone at (317) 232-1360 or by e-mail at ingrainbuyers@isda.in.gov with questions regarding these new statutory requirements.

Click on each titled section below to learn more.

  • New Contract Language Required

    Effective April 29, 2021, all contracts for the purchase of grain from producers, except a flat price contract or a contract for the production of seed, are now required to include the following updated notice immediately above the place on the contract where the seller of the grain must sign. In accordance to House Enrolled Act No. 1483, the previous required contract language has been updated to included additional language. This updated notice must be printed in all capital letters exactly as it is stated directly below.

    NOTICE - SELLER IS CAUTIONED THAT CONTRACTING FOR THE SALE AND DELIVERY OF GRAIN INVOLVES RISKS. THESE RISKS MAY INCLUDE FUTURE PAYMENTS BY YOU TO MAINTAIN THIS CONTRACT, A LOWER SALES PRICE, AND OTHER RISKS NOT SPECIFIED. INDIANA STATE LAW REQUIRES THAT AFTER JULY 1, 2022, ALL DEFERRED PRICED GRAIN MUST BE PRICED WITHIN THE CROP YEAR AS DEFINED BY IC 26-3-7-2(7). THIS CONTRACT MUST BE PRICED BY _(Insert Date)_. COVERAGE UNDER THE INDIANA GRAIN INDEMNITY PROGRAM IS FOR GRAIN THAT HAS BEEN DELIVERED TO A FIRST PURCHASER LICENSEE WITHIN THE 15 MONTHS BEFORE THE DATE OF FAILURE AND IS LIMITED TO 100% OF A LOSS FOR STORED GRAIN AND 80% OF A LOSS FOR OTHER COVERED CONTRACTS. BE SURE YOU UNDERSTAND THE NATURE OF THIS CONTRACT AND THE ASSOCIATED RISKS.

    Source: Indiana Code 26-3-7-3(a)(12)

  • New Deferred Pricing (Price Later) Contract Requirements & Penalties

    Effective July 2, 2022, a licensee may not enter into a deferred pricing agreement in connection with grain purchases that extends beyond the crop year for the delivered grain as defined in Indiana Code 26-3-7-2(7). Additionally, a licensee may not transfer the deferred pricing agreement to a new contract beyond the crop year for the delivered grain.

    If a deferred pricing agreement in connection with a grain purchase was entered into before July 1, 2021, the licensee shall complete full payment obligations to the seller under the agreement before January 1, 2024. The determined price date of a deferred pricing agreement shall be:

    1. The determined price date set forth in the deferred pricing agreement, if that date occurs before January 1, 2024.
    2. If option 1 does not apply, a determined price date that is mutually agreed to by the licensee and the seller.
    3. Or if options 1 and 2 do not apply, the date on which the licensee completes their payment obligations to the seller.

    If a licensee is found out of compliance with this section, the director shall issue a notice stating that the licensee has 30 days to price grain for the initial deferred pricing agreement. If a licensee fails to price grain within 30 days of the notice, the director may impose a fine on the licensee up to $1,000. If a licensee fails to price grain within 60 days of the date of the notice, the director may impose a fine up to $2500 per month until the licensee is compliant.

    Source: Indiana Code 26-3-7-26.5

  • What is a Crop Year?

    Crop year is defined as the period from one year's harvest to the next year for field crops as follows:

    1. Barley and barley seed from June 1 to May 31.
    2. Canola and canola seed from July 1 to June 30.
    3. Corn and corn seed from September 1 to August 31.
    4. Lentils and lentil seed from July 1 to June 30.
    5. Oats and oat seed from June 1 to May 31.
    6. Popcorn and popcorn seed from September 1 to August 31.
    7. Rye and rye seed from June 1 to May 31.
    8. Sorghum and sorghum seed from September 1 to August 31.
    9. Soybeans and soybean seed from September 1 to August31.
    10. Sunflower and sunflower seed from September 1 to August 31.
    11. Wheat and wheat seed from June 1 to May 31.
    12. For all other field crops and other field crop seed from September 1 to August 31.

    Source: Indiana Code 26-3-7-2(7)

  • New Bond, Letter of Credit, and/or Cash Deposit Requirements

    Effective April 29, 2021, the amount of bond, letter of credit, and/or cash deposit a licensee is required to have on file with the agency increased to a maximum of $325,000 per license and a total of $1,250,000 per person.

    All licensees should continue to calculate their required bond, letter of credit, and/or cash deposit amount as they have in the past [Indiana Code 26-3-7-10(a)].  However, a licensee may now be required to increase the dollar amount it has on file with the agency under this new statutory requirement.  A licensee should reconcile Section F of its most recently filed annual license renewal application with its bond, letter of credit, or cash deposit to determine its maximum dollar amount required.

    IMPORTANT NOTICE: The director of the agency may still require a licensee to have additional bonding as the director considers necessary in accordance with Indiana Code 26-3-7.

    Source: Indiana Code 26-3-7-10(b)

  • Accepting Independent Audits from a Licensee

    Effective April 29, 2021, the director of the agency may now receive and consider financial audits from a licensee that were conducted by an independent audit or accounting firm.  This new option does not preclude the director or other representatives of the agency from conducting other onsite visits, reviews, or inspections of a licensee as necessary.

    Source: Indiana Code 26-3-7-3(a)(17)

  • What does the term Suspension mean?

    Effective April 29, 2021, the term “suspension” is now defined within the Indiana Grain Buyers and Warehouse Licensing and Bonding Law [Indiana Code 26-3-7] to mean a temporary halt to the purchase of grain under Indiana Code 26-3-7-18(b).

    Source: Indiana Code 26-3-7-2(30)

  • Establishing Fines for Violations

    Effective April 29, 2021, the director of the agency may now adopt rules under Indiana Code 4-22-2 to establish fines that may be assessed against licensees or persons found violating the Indiana Grain Buyers and Warehouse Licensing and Bonding Law [Indiana Code 26-3-7].

    Source: Indiana Code 26-3-7-3(a)(19)

Temporary and Emergency Storage

The Indiana Grain Buyers and Warehouse Licensing Agency wants to remind the state’s licensed grain facilities that they can apply for temporary or emergency storage by contacting the agency. Requests must be submitted in writing and approved by the agency’s director.
Before applying for temporary or emergency storage, licensees must adhere to the following requirements, which are outlined in the Indiana Administrative Code.
  • Apply for Temporary Storage
    For a temporary storage request, the licensee must have:
    • asphalt or concrete floor,
    • rigid, self-supporting sidewalls,
    • aeration,
    • acceptable waterproof covering,
    • access to the grain for the purpose of sampling; and,
    • the grain must be removed from temporary storage by May 1 of the year following the harvest, unless an extension is granted by the agency director.

    Once a temporary or emergency storage request has been approved, the grain is considered an increase in licensed capacity and subject to the same requirements as grain stored in conventional spaces. Warehouse operators are also responsible for maintaining the quantity and quality of the grain.

    These options are only available to licensees with a grain bank, warehouse or buyer-warehouse license.

    How to apply for temporary or emergency storage

    All request for temporary or emergency storage must be submitted to the Agency in writing on company letterhead via first class mail or electronic mail.  For further assistance, please contact the Agency's main office by calling (317) 232-1360.

    Mailing Address:
    Indiana Grain Buyers and Warehouse Licensing Agency
    One North Capitol Avenue, Suite 600
    Indianapolis, IN 46204

    Electronic Mail:
    ingrainbuyers@isda.in.gov

    Contact

    If you have any questions related to this matter please call the IGBWLA office at (317) 232-1360.
  • Apply for Emergency Storage
    For an emergency storage request, the grain must be:
    • paid in full and owned by the elevator,
    • removed from emergency storage by Jan. 31 of the year following the harvest, unless an extension has been granted by the agency director; and,
    • no stored grain belonging to others is allowed.

    Once a temporary or emergency storage request has been approved, the grain is considered an increase in licensed capacity and subject to the same requirements as grain stored in conventional spaces. Warehouse operators are also responsible for maintaining the quantity and quality of the grain.

    These options are only available to licensees with a grain bank, warehouse or buyer-warehouse license.

    How to apply for temporary or emergency storage

    All request for temporary or emergency storage must be submitted to the Agency in writing on company letterhead via first class mail or electronic mail.  For further assistance, please contact the Agency's main office by calling (317) 232-1360.

    Mailing Address:
    Indiana Grain Buyers and Warehouse Licensing Agency
    One North Capitol Avenue, Suite 600
    Indianapolis, IN 46204

    Electronic Mail:
    ingrainbuyers@isda.in.gov

    Contact

    If you have any questions related to this matter please call the IGBWLA office at (317) 232-1360.