PIERRE, SD – As we welcome cooler weather, South Dakota Public Utilities Commissioners recommend grain producers, buyers and warehouses to brush up on the state’s grain purchase and storage policies.
To reduce producer risk and preserve financial security, the PUC licenses and inspects grain buyers and grain warehouses, helps ensure licensed facilities are meeting their obligations to grain producers and confirms facilities and buyers are operating within the requirements of state laws and administrative rules.
The PUC recommends those in the grain industry be aware of these key points:
- Licensed grain buyers and grain warehouses are subject to bonding requirements.
- Deals made with unlicensed buyers offer producers and elevators no bond protection at all.
- When selling grain, producers have 30 days to choose between receiving an immediate payment or payment at a later date. At the end of 30 days, grain must be either put on a contract or paid.
- Cash-sale grain delivered to a licensed grain buyer or grain warehouse may be covered by the bond required under state law. Coverage is limited and is not a guarantee of payment. Price-later, deferred-payment, and delayed-price contracts are not covered.
- South Dakota administrative rules outline requirements for temporary and emergency grain storage, including specifications for storage units.
- State law requires that each licensed facility receive at least one inspection from PUC staff each year, which includes a review of scale tickets and receipts.
- PUC staff reviews financials of licensed grain warehouses and grain buyers periodically throughout the year to determine whether the licensee is in compliance with the statutory requirements.
- South Dakota law requires grain buyers and grain warehouses to notify the PUC if they fall out of compliance with any financial licensing requirement.
- Grain producers with any concerns, including those regarding a company’s business practices, compliance with state laws and rules or timely payment to producers, are encouraged to contact the PUC grain warehouse program by calling 605-773-3201 or sending an email to PUC@state.sd.us.
- The commission and PUC staff have the authority to investigate licensed grain buyers and public grain warehouses and initiate proceedings to suspend or revoke a license and to collect on a licensee’s bond, if necessary.
To date, the PUC has issued grain buyer licenses and state warehouse licenses to 186 entities with over 362 locations in 2026.
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