September 02, 2009

Department of Agriculture Director Asks State Auditor to Review Grain Industry Practices

Missouri Department of Agriculture Director Jon Hagler has asked Missouri State Auditor Susan Montee to begin an advisory review of the department's Grain Regulatory Service's current practices and offer her staff's guidance on standard auditing procedures.

"This year, Missouri has been faced with the two largest grain failures in state history along with farmers facing economic challenges across all sectors. Our Grain Regulatory staff has done a tremendous job uncovering irregularities and assisting farmers across Missouri with filing claims and answering questions during their times of need," said Dr. Hagler. "Auditor Montee and her staff have the expertise to thoroughly review and recommend additional tools we may need to protect farm families."

The Department of Agriculture has logged over 1500 hours this year on grain insolvencies. On Feb. 9, Danny Froman of Gallatin Grain Company voluntarily surrendered his Missouri Grain Warehouse and Grain Dealer licenses to the Department of Agriculture after a walk-through inspection. In a separate case, on Feb. 20 following an inspection resulting from a competitor's complaint, Cathy Gieseker of T.J. Gieseker Farms and Trucking's grain dealer's license was suspended. In both cases, the Department of Agriculture accepted claims from farmers affected and have conducted administrative hearings to determine the validity and payout of each claim.

In the past 22 years, farmers have been impacted by 36 grain insolvencies resulting in the loss of $3.3 million. This year alone, Missouri farm families have lost over $30 million between the cases in Gallatin and Martinsburg.

Missouri's Grain Regulatory Services program protects the public's interest by licensing, bonding and auditing grain warehouses and grain dealers to ensure financially sound grain markets for Missouri's farmers to store and merchandise their grain. Grain depositors or sellers experiencing difficulty receiving payment or redelivery of their grain may contact the program at (573) 751-4112. For more information on how to protect grain transactions, visit