Grain dealers are in the business of buying grain where the title of the grain transfers from the seller to the buyer. A grain warehouse is used for the purpose of storing grain.
Missouri's Grain Regulatory Services Program administers the Missouri Grain Warehouse Law, the Missouri Grain Dealer Law, and related administrative rules. Both grain dealers and grain warehousemen in Missouri are required to obtain a surety bond in order to do business in the state.
For Grain Warehousemen, a surety bond is for the benefit of the persons storing grain, and only covers storage grain deposited with a warehouseman. The bond amount is based upon the licensed capacity of the warehouse. The minimum bound amount is $20,000 and the maximum bond amount cannot be more than $1 million, except in the case of a deficiency in the net worth. The Director may also require an additional bond is he finds that it is necessary. The surety bond guarantees faithful performance and compliance with all the provisions of the Missouri Grain Warehouse Law.
A Grain Dealer must post a surety bond for at least $50,000 and no more than $600,000. The amount is to be established by the Director, who uses a formula based on the aggregate dollar amount paid by the dealer for grain purchased during the dealer's last completed fiscal year. If the dealer has not been in business for a year, then the bond is based on the estimated amount of grain to be purchased in the upcoming year.
If the grain dealer surpasses the estimated aggregate dollar amount to be paid for grain purchased, then he will be required to obtain an additional surety bond as determined by the Director.
If a grain dealer believes his net worth is enough to guarantee payment for grain purchased by him, he may make a formal written request to the Director to have the bond obligation relived in excess of $50,000. The request must also have a financial statement that has been prepared within four months of the date of the request, plus any other financial information, which could include submission of a financial statement audited by a public accountant.
In lieu of a surety bond, Grain Dealers may submit a certificate of deposit or irrevocable letter of credit.
The Surety Bond is for the benefit of all persons selling grain to the grain dealer. The bond remains in force at all times when the dealer is conducting business as a licensed grain dealer.
Grain dealers and warehousemen must file the bond with the Director and provide financial statements. Failure to do so could be grounds for suspension or revocation by the Director.
The premium you pay for a Missouri Grain Dealer Bond or a Grain Warehouse Bond depends on the bond amount and your credit. Our rates start at 1% of the bond amount with good credit. Contact our Surety Bond Specialists for a free quote that fits your specific situation.
A Missouri Grain Warehouse Surety Bond and a Missouri Grain Dealer bond is continuous until canceled.
Check out our FAQ page or What’s a Surety Bond? page. Should you need or choose to buy a surety bond, buy from us. SuretyGroup.com has been underwriting surety bonds throughout the U.S. for more than 35 years. When you work with us, you enjoy the unique benefit of dealing with a team of highly experienced surety agents with in-house underwriting authority. This allows you to receive competitive, low rates, quick approvals, and immediate bond delivery. In most cases, your bond will be delivered within 24 hours after you apply for it.
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