Grain Financial Protection Program (GFPP)

• The applicant must be a business purchasing canola, grain corn, soybeans, or wheat from producers for purposes other than personal use, and/or operating a grain elevator storing grains or oilseeds other than their own.
• The applicant must hold a valid grain dealer licence (for buyers) and/or grain elevator operator licence (for storage operators).
• The business must submit the required application forms and supporting documents to Agricorp, including applicable business registration and recent financial statements prepared by a third party (for dealers).
• The applicant must demonstrate financial responsibility as assessed by Agricorp through quantitative and qualitative analysis, or provide tangible financial security if unable to meet the criteria through financial review.
• The applicant must pay all relevant licensing fees and comply with the requirements set out by the Grain Financial Protection Program and the Grains Act.

Who is eligible?

• Grain dealers who purchase canola, grain corn, soybeans, or wheat from producers for purposes other than personal use
• Companies operating grain elevators that store grains or oilseeds not owned by them

Eligible expenses

• Compensation for producers following dealer or elevator operator failure to meet payment or storage obligations (covering a portion of financial losses on approved claims).

Eligible geographic areas

• Ontario

• Current ratio: 23 points maximum – Measures the ability to meet short-term obligations.
• Debt to equity ratio: 25 points maximum – Assesses use of financial leverage and risk.
• Interest coverage ratio: 10 points maximum – Evaluates the ability to service business debt.
• Profit margin on sales ratio: 20 points maximum – Indicates profitability of the business.
• Stability ratio: 15 points maximum – Reflects the relationship between sales volume and equity.
• Average collection period ratio: 2 points maximum – Assesses how quickly the business collects accounts receivable.
• Line of credit ratio: 5 points maximum – Indicates extent of line of credit usage.

• Step 1: Submit Application
  • Obtain and complete the appropriate application form from agricorp.com: either Application for a Licence as a Dealer in Grain or Application for a Licence as a Grain Elevator Operator.
  • For grain dealers: Submit the Application for a Licence, Financial Responsibility Form, Banker’s Confirmation, licence fee payable to Agricorp, business registration form or articles of incorporation, and financial statements for the past three years (prepared by a third party).
  • For elevator operators: Submit the Application for a Licence, Agricorp’s Certificate of Insurance Coverage, and licence fee payable to Agricorp.
  • Send all completed forms and required documents to Agricorp.
• Step 2: Prove Financial Responsibility
  • Agricorp conducts a quantitative analysis of financial responsibility, using submitted financial statements to calculate key financial ratios and assign a financial score.
  • The Financial Responsibility Review Committee performs a qualitative analysis, evaluating intangible factors such as management experience, level of risk, and quality of financial information.
  • If the initial financial responsibility requirement is not met, applicants may submit additional documentation (e.g., financial commentary, banking arrangement information, financial projections, appraisals) to strengthen their application.
• Step 3: Obtain Licence Approval
  • The Financial Responsibility Review Committee makes a recommendation to the chief inspector based on the quantitative and qualitative assessments.
  • If approved, the licence is mailed to the applicant, who must display it prominently at their place of business.
  • If not approved, Agricorp will provide reasons and options for next steps, such as providing corporate indemnification, personal guarantees, or shareholder loan postponements to meet requirements.
• Step 4: Provide Financial Security (if required)
  • If the applicant still does not meet financial responsibility criteria, tangible financial security (e.g., letter of credit, surety bond) and a Purchase Declaration must be provided.
  • The amount of security required is determined based on highest monthly purchases, and security must extend three months beyond the licence expiry date.
• Step 5: Application Review and Issuance
  • Agricorp reviews all documents and security provided.
  • Upon final approval, the official licence is issued for one year.

• Coverage levels for claims decrease as the length of any deferred payment arrangement increases.
• Small dealers renewing their licence may be exempt from the financial security requirement.
• Official grain storage receipts must include detailed information and are available from the Ontario Agri Business Association.
• Applicants who do not meet financial responsibility may provide additional security options, such as personal guarantees or shareholder loan postponements.