Grain scandal takes its toll on Delta farmers

Mar 13, 2015 at 10:09 AM CST
By JACK WEATHERLY Harper Ross will not be planting this year for the first time in 24 years, he says, because of the losses he suffered at the hands of an Arkansas-based grain dealer. Ross sold off most of his 6,000 acres in Leland after he and five other Mississippi farmers lost $1.8 million on corn they sold last year to Turner Grain Merchandising of Brinkley. In addition to the corn, Ross individually booked rice valued at $1.8 million with Turner Grain, he said in an interview. Josh Oakes, one of the owners of the 11,000-acre Grace Ag Partnership at Greenville, said the farm is owed $400,000 for its share of the corn. He said the farm was able to absorb the loss. “We’re just moving on past it and hoping something will come out of it.” Oakes said Grace Ag will plant 3,000 acres of corn and 8,000 in soybeans. “Of course, we’re a little more skeptical of who we’ll do business with [but] we felt like we did due [diligence] with Turner Grain. They’ve always had a good reputable company till last year.” Scott Phillips, a Greenville attorney representing the farmers, did not respond to several messages left for him. The other plaintiffs are Gracewood Farms of Hollandale, CC&B Farms of Hollandale, Triple C Farm of Leland and Reality Partners II. The Mississippi farmers filed suit on Oct. 2 in the U.S. District Court for Eastern Arkansas. Subsequently, Turner Grain filed for Chapter 11 to reorganize itself and present a plan to the court. However, the U.S. Bankruptcy Court for Eastern Arkansas appointed a trustee, who on Feb. 20 filed a motion to liquidate under Chapter 7 of the U.S. code. Turner Grain failed to file monthly operating reports, which “are a source of vital, financial information,” wrote Daniel J. Casamatta, the trustee. “The Debtor has ceased operations and there is no likelihood or intent for rehabilitation or reorganization,” Casamatta said. Thus, “a liquidation of the Debtor would be most economically effectuated in a Chapter 7.” U.S. District Judge Phyllis Jones set a hearing on the motion for May 14 at 10 a.m. in the Eastern District courthouse at Helena. The dealer listed $24.8 million in debts and $13.8 million in assets when it filed for bankruptcy protection on Oct. 23. Arkansas does not require its grain dealers to be licensed or audited, but legislation moving through the General Assembly would make that mandatory. Mississippi requires dealers to be licensed. The Arkansas Grain Dealers Act would require dealers to be licensed annually and possibly post a surety bond and submit to an audit. Without such protection, estimated losses for Arkansas farmers stood to rise to $50 million, after payments from Turner Grain stopped last summer. Arkansas farmers and Louisiana processors have filed several lawsuits to recoup their losses. Efforts to find the grain proved unsuccessful. No criminal charges have been filed in Arkansas, but Fletcher Long, prosecutor for the First Judicial District, said only that “the whole thing is still under investigation.” A call to the federal prosecutor in Little Rock was not immediately returned. The scandal could force some producers into bankruptcy, said Steve Eddington, vice president for public relations for the Arkansas Farm Bureau, which helped craft Senate Bill 555, which was filed Feb. 25 and earlier this week was in a Senate committee.

Mar 13, 2015 at 10:09 AM CST

By JACK WEATHERLY

Harper Ross will not be planting this year for the first time in 24 years, he says, because of the losses he suffered at the hands of an Arkansas-based grain dealer.

Ross sold off most of his 6,000 acres in Leland after he and five other Mississippi farmers lost $1.8 million on corn they sold last year to Turner Grain Merchandising of Brinkley.

In addition to the corn, Ross individually booked rice valued at $1.8 million with Turner Grain, he said in an interview.

Josh Oakes, one of the owners of the 11,000-acre Grace Ag Partnership at Greenville, said the farm is owed $400,000 for its share of the corn.

He said the farm was able to absorb the loss. “We’re just moving on past it and hoping something will come out of it.”

Oakes said Grace Ag will plant 3,000 acres of corn and 8,000 in soybeans.

“Of course, we’re a little more skeptical of who we’ll do business with [but] we felt like we did due [diligence] with Turner Grain. They’ve always had a good reputable company till last year.”

Scott Phillips, a Greenville attorney representing the farmers, did not respond to several messages left for him.

The other plaintiffs are Gracewood Farms of Hollandale, CC&B Farms of Hollandale, Triple C Farm of Leland and Reality Partners II.

The Mississippi farmers filed suit on Oct. 2 in the U.S. District Court for Eastern Arkansas.

Subsequently, Turner Grain filed for Chapter 11 to reorganize itself and present a plan to the court.

However, the U.S. Bankruptcy Court for Eastern Arkansas appointed a trustee, who on Feb. 20 filed a motion to liquidate under Chapter 7 of the U.S. code.

Turner Grain failed to file monthly operating reports, which “are a source of vital, financial information,” wrote Daniel J. Casamatta, the trustee.

“The Debtor has ceased operations and there is no likelihood or intent for rehabilitation or reorganization,” Casamatta said. Thus, “a liquidation of the Debtor would be most economically effectuated in a Chapter 7.”

U.S. District Judge Phyllis Jones set a hearing on the motion for May 14 at 10 a.m. in the Eastern District courthouse at Helena.

The dealer listed $24.8 million in debts and $13.8 million in assets when it filed for bankruptcy protection on Oct. 23.

Arkansas does not require its grain dealers to be licensed or audited, but legislation moving through the General Assembly would make that mandatory.

Mississippi requires dealers to be licensed.

The Arkansas Grain Dealers Act would require dealers to be licensed annually and possibly post a surety bond and submit to an audit.

Without such protection, estimated losses for Arkansas farmers stood to rise to $50 million, after payments from Turner Grain stopped last summer. Arkansas farmers and Louisiana processors have filed several lawsuits to recoup their losses. Efforts to find the grain proved unsuccessful.

No criminal charges have been filed in Arkansas, but Fletcher Long, prosecutor for the First Judicial District, said only that “the whole thing is still under investigation.”

A call to the federal prosecutor in Little Rock was not immediately returned.

The scandal could force some producers into bankruptcy, said Steve Eddington, vice president for public relations for the Arkansas Farm Bureau, which helped craft Senate Bill 555, which was filed Feb. 25 and earlier this week was in a Senate committee.