Producers Paying Storage On Unused Fertilizer

Fertilizer manufacturers are charging storage fees to producers in southwestern Manitoba and southeastern Saskatchewan for fertilizer they ordered but couldn’t use due to the unusually wet field conditions this spring.

“Farmers are being charged storage costs for anhydrous ammonia that didn’t get delivered. They are getting charged by the month,” said Doug Chorney, president of Keystone Agriculture Producers.

“Nobody is happy. They have already paid for this product. They feel they are being victimized,” Chorney said. “It would be different if farmers had some revenue to offset these added costs, but when you have no crop seeded, it’s a bad time to be looking for money from producers.”

Arlynn Kurtz, vice-president of the Association of Saskatchewan Agr icultural Producers (APAS), said producers that couldn’t use all of their fertilizer are also paying the price.

“Anything that you’ve taken delivery on and if it’s a deferred financing contract, you pay monthly interest on that,” Kurtz said.

One person in the fertilizer industry, who asked to remain anonymous, confirmed that producers were being charged, with the cost ranging from $10 to $20 per tonne per month. The source said the charge was being driven from the fertilizer manufacturers.

He added that he was not surprised producers were being charged to keep product in the dealer’s storage facilities.

Chorney said some producers who have liquid or dry fertilizer and have the room have been storing it at their yards.

“Some farmers might plan to put in winter wheat in August or September, and use some of it then,” he said.

Chorney agreed that there is some cost for companies when storing the fertilizer, but said this was a bad time to be billing producers.

“There is a carrying cost for carrying it, and we don’t want to see our carriers go broke because they have to store it, but we sure would like to see the companies give a bit of latitude to producers when they are down and out,” he said.

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