The National Corn Growers Association has released updated information for corn growers concerned about the status of pending contracts with the bankrupt ethanol producer VeraSun.
Newly posted on NCGA's Web site are briefing papers that update growers on how VeraSun is handling contracts, on a plant-by-plant basis, and the alternatives for growers should VeraSun sell some or all of its plants.
With regard to the former, attorneys for NCGA point out that VeraSun generally seems to be20handling grower contracts based on the original ownership of the ethanol facilities, but growers need to check with the plants directly to determine what arrangements can be made.
Should some of the plants be sold, attorneys say that while it seems unlikely that the buyer will want to assume above-market contracts, they will need a steady supply of corn and will need some amount of good will, or will at least want to avoid bad will among the local or regional producers – leaving the door open for a consensual agreement that could work to the grower’s advantage.
“In today’s volatile economy, growers who have contracted to sell grain to VeraSun need to stay completely informed about the bankruptcy process and how these contracts are handled,” says NCGA Chairman Ron Litterer. “We’re committed to ensure that the interests of U.S. corn growers are protected and their voices heard.”
As the leading association representing U.S. corn growers, NCGA has been attentive to the VeraSun issue. Litterer, a grower from Greene, Iowa, is leading the Ad Hoc Advisory Committee, which was formed to make certain that the views, expertise, and interests of corn growers in the VeraSun case were represented effectively before the U.S. Bankruptcy Court in Delaware and to VeraSun, and to help keep members of NCGA and state affiliates informed regarding the process and activities of VeraSun’s situation.
For NCGA’s VeraSun Bankruptcy Resource Page, click here.