Oilseed growers to receive second round of payments

The Montana Department of Agriculture mailed a second round of payments Tuesday to 42 farmers in Montana and North Dakota after liquidation of cooking oil and other agricultural assets at the Sustainable Systems LLC plant at Culbertson.

The checks and an earlier payment in June will supply Montana producers with about 90 percent of the money owed to them when they delivered 2008 safflower crops to the plant, said department director Ron de Yong.

 Sustainable Systems has ceased operations. Processed oil, seeds and other inventory are being sold by the department under a Montana law that protects agricultural producers of contracted crops.

A third round of payments is expected to come close to fulfilling the growers' contracts after purchasers of the liquidated products pay the department, he said.

Five department officials met with growers July 9 in Culbertson to explain state laws and the process used to recover funds from the company.  Director de Yong said the department worked with the company several months prior to stepping in after company officials said they were trying to obtain additional financing to pay debts and keep the plant in operation.

When new financing was not obtained, the department secured agreement from Sustainable Systems to voluntarily relinquish its commodity dealer's license and cooperate with the product liquidation. Those agreements hastened the payments to farmers by avoiding the need for court action to enforce the state's authority, he told growers assembled in the Culbertson school cafeteria.

Checks in the second round of payments totaled $338,953 with amounts to each grower based on a percentage of the money owed. Initial payments in June included proceeds from a Montana bond posted by the company. North Dakota growers will receive bond payments under a different procedure handled by the North Dakota Public Service Commission.

 For more information about the liquidation effort, contact Andy Gray at 406-444-3730 or by e-mail at agr@mt.gov.