Current RMA procedures require that for grain delivered to a
commercial elevator, every truckload of grain must be
tested for sprout at a cost of at least $10 per sample. These
procedures were instituted several years ago, after a USDA
Inspector General’s report found excessive indemnities paid from
allegedly manipulated grain samples. In contrast, grain in
farm-stored bins can be accumulated and one test per bin will
suffice.
In a pair of memos to RMA Administrator Ross Davidson, NAWG
had pointed out that this treatment imposes additional cost and
inefficiency on growers delivering to commercial elevators, and
deviates from the standard practice of the industry for
determining grades on grain. Some producers in Kansas and
elsewhere had sprout claims denied because their samples were
commingled according to standard commercial practice.
To remove the efficiency and preserve program integrity, NAWG
proposed using final settlement sheets as the basis for
determining sprout damage. The settlement sheet is evidence of
the contractual sale between producer and elevator, and there is
no incentive for manipulating the sample; instead, this document
will specify the quality grades that the grower was paid on by
the elevator, including any deductions for sprout damage.
Settlement sheets are also used as proof under the Hard White
Wheat Incentive Program (through FSA) that the wheat in question
has met the requirements of quality standards and sales.
An additional justification for this approach is to make
whole the producers who had previous claims denied because of
commingled samples. Even the producers in areas where harvest is
complete will have final settlement sheets for each lot they
wish to claim, so this solution also addresses the problem of
regional equality.
Requiring final settlement sheets for claiming a quality loss
will mean that producers cannot apply for the loss adjustment
until they have sold their grain and settled with the elevator.
NAWG stated that this is a situation that producers would accept
to avoid the cost and inefficiency of testing each truckload
separately for sprout damage.
