Updating grain grading dispute resolution

Consultation period ended

The consultation regarding proposed improvements to “Subject to Inspector’s Grade and Dockage” ended on February 28, 2022. We thank all of those who gave us their comments.

About the Canadian Grain Commission

The Canadian Grain Commission is a federal government department. We administer and enforce the Canada Grain Act and the Canada Grain Regulations.

Under the Act and Regulations, we establish and maintain Canada’s grain quality standards. We also regulate the grain industry to protect producers’ rights and to ensure the integrity of grain transactions.

Our programs help to ensure shipments of Canadian grain are safe, reliable, and provide a dependable commodity for international and domestic customers.

Introduction

When producers deliver grain to a licensed primary elevator, their grain is assessed by the receiving elevator for grade and dockage. As indicators of the grain’s quality and cleanliness, grade and dockage are factors in determining the payment value of the grain delivery. If the producer disagrees with the elevator’s assessment, they have the right to request that the sample be assessed by the Canadian Grain Commission for an independent, binding decision. This is often referred to as “Subject to Inspector’s Grade and Dockage” (“Subject to”).

Objectives of the proposed changes

Under the Canada Grain Act, the Canadian Grain Commission provides “Subject to” as a cost-effective means of grade and dockage dispute resolution at licensed primary elevators. However, as the grain sector has evolved over the years, the process for triggering a dispute resolution request has not kept pace. One of the key areas of stakeholder feedback under the recent Canada Grain Act Review consultation led by Agriculture and Agri-Food Canada was that this Canadian Grain Commission service needed to be modernized to reflect current business practices. As discussions on the potential legislative outcomes of the review continue, the Canadian Grain Commission is proposing regulatory updates to “Subject to” in response to the specific feedback received in this area.

The proposed changes would

  • clarify the minimum time requirements for retaining a sample
  • allow for more flexible arrangements between the producer and primary elevator in determining who, where and how long a delivery sample is held
  • clarify that producers are able to access grain grading dispute resolution even if they are not able to deliver the grain themselves
  • clarify the time period over which a producer is entitled to exercise their right to access grain grading dispute resolution, including a period after delivery

We are seeking feedback from grain sector stakeholders on these proposed changes.

Purpose of consultation document

This document explains

  • the proposed regulatory changes
  • how to submit input
  • what happens after the consultation is concluded

Background

In January 2021, Agriculture and Agri-Food Canada launched consultations as part of its review of the Canada Grain Act. The consultation process enabled stakeholders to provide their ideas to improve the regulatory framework that establishes the grain quality assurance system and producer protections. While work continues on the broader response to the Canada Grain Act consultation, the Canadian Grain Commission has an opportunity to address some of the feedback on “Subject to” within existing regulations.

Many stakeholders affirmed that access to binding determination of inspector’s grade and dockage is an important producer protection and that it should be maintained. Producers and producer groups asked for modernized rules because grain delivery and handling processes have changed. Producers are often not present when their grain is delivered to the licensed primary elevator. Third parties, such as commercial truck drivers, are increasingly being hired to deliver grain into the licensed elevator system.

As currently worded, the Canada Grain Regulations do not provide the producer with an opportunity to dispute an elevator operator’s grade and dockage assessment if the producer is not present at the time of delivery. Producers were clear that they want access to a binding determination of grade and dockage even if they are not present at delivery. They would also like to see an extension to the amount of time a producer has to request a binding determination of grade and dockage after delivery.

Stakeholders have also asked the Canadian Grain Commission for clarity on sample retention including who can retain the sample and for how long samples should be retained.

Proposal for stakeholder input

In order to provide clarity on the process and timing for sampling on delivery and obtaining a binding determination of grade and dockage, the Canadian Grain Commission is proposing amendments to sections 34 and 36 of the Canada Grain Regulations. Taken together, these updates would provide more time for a producer to exercise their right to grain grading dispute resolution and ensure this right remains accessible even if they do not deliver the grain themselves.

Section 34

The Canadian Grain Commission is proposing to update section 34 to clarify the minimum requirements for sample retention to support a longer timeframe for producers to trigger a subject to inspector’s grade and dockage request. The changes would specify that a sample from each producer delivery must be retained for the lesser of the following:

  • seven days after the date the operator of the licensed primary elevator determines the grade and dockage of the sample and issues the primary elevator receipt, or
  • until an agreement on grade and dockage has been made between the elevator operator and the producer and an appropriate primary elevator receipt or cash purchase ticket has been issued, or
  • until a producer requests access to inspector’s binding determination of grade and dockage and the sample has been accessed for this purpose.

This approach would provide flexibility for the producer and primary elevator to agree to where and for how long a sample is retained, as long as minimum requirements are met.

Section 36

The Canadian Grain Commission is proposing to update section 36(1) to clarify that a producer can trigger a binding review of grade and dockage even if they are not present at delivery, in accordance with the amendments to section 34. The producer would be required to request binding determination of grade and dockage within seven days of receiving the primary elevator receipt.

Providing your input

We want to hear your views on the following

  • the proposal outlined in this document
  • the potential impacts and costs to yourself or organization
  • any improvements to the proposed changes

How to submit your input

The Canadian Grain Commission must receive your input in writing between December 13, 2021 and midnight on February 28, 2022 for consideration.

You are invited to submit input in the official language of your choice by

  • email to discussions@grainscanada.gc.ca
  • fax to 204-983-2751
  • mail (including a return address) to

    “Subject to” proposal comments
    Canadian Grain Commission
    600-303 Main Street
    Winnipeg, MB R3C 3G8

The Canadian Grain Commission recommends that you include the following information along with your input:

  • your full name
  • your phone number
  • your complete mailing address
  • your email address
  • the reason for the input
  • information on the organization you represent, if any
  • any additional information that is relevant

If you are submitting a meeting request to provide direct input, please provide the following information:

  • your full name
  • the name of the organization you represent
  • your organization’s phone number
  • your organization’s complete mailing address
  • your organization’s email address
  • the approximate date(s) when your organization wishes to meet with the Canadian Grain Commission
  • any additional information that is relevant

This document is also available on our website. If you have any questions, please contact us.

Thank you in advance for your contribution.

How we use your input

We will study your input along with other considerations, such as the following:

  • input received from other stakeholders on the same subject
  • consistency with the Canadian Grain Commission’s mandate to establish and maintain standards of quality for Canadian grain, regulate grain handling in Canada, and to ensure that grain is a dependable commodity for domestic and export markets
  • the legal or policy implications of your proposals within the framework of the Canada Grain Act if applicable
  • consistency with broader Government of Canada policies and priorities

We are committed to an open and transparent process. We will summarize all input received in a report following the comment period. To maintain your confidentiality, names of individuals will be protected in accordance with the Privacy Act.

Next steps

The Canadian Grain Commission will compile input we receive and publish a summary of what we heard after the consultation process concludes. We will consider and assess all feedback including relevant legal and operational requirements and the value-added potential for the grain sector before any regulatory changes are made.

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