FOR IMMEDIATE RELEASE: Oct. 29, 2025                
CONTACT: Leah Mohr, South Dakota Public Utilities Commission, (605) 773-3201 or (605) 280-4327

PUC recommends grain producers, buyers and warehouses brush up on state laws and rules this harvest season

PIERRE, S.D. – With harvest season in full swing, the South Dakota Public Utilities Commission urges grain producers, buyers and warehouses to review state laws and rules regarding the purchase and storage of grain. Understanding these state policies is a vital step to protect the investments of producers and buyers.

The PUC is responsible for monitoring South Dakota’s grain industry. To reduce producer risk and preserve financial security, the agency 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.

“State laws and rules help safeguard South Dakota producers, but farmers themselves have a key role in protecting the integrity of the grain industry. It is important to be critical of deals that seem too good to be true and reach out to the commission immediately when concerned about slow or no payment. Our grain warehouse staff relies on conversations with and feedback from producers who have questions or report concerns,” said PUC Chairman Gary Hanson

“Fully understanding the details of a contract prior to signing is an essential step producers should take to protect their interests,” stated PUC Vice Chairman Chris Nelson. “Not all grain purchase contracts are created equal. If you agree to a voluntary credit sale or price later contract, those sales are not protected by the grain buyer’s bond or any form of insurance, and that is a risk producers need to be aware of,” he explained.

“We understand that harvest is a busy time, but this is a situation where knowledge is power. Producers, warehouses and buyers who are well informed are not only in a better position to make the best decisions for themselves, but also have the knowledge needed to identify issues early, act as good neighbors and look out for their communities as a whole,” declared PUC Commissioner Kristie Fiegen.

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 to a contract or paid.
• Cash sale grain is protected by a licensed grain buyer or grain warehouse’s bond. Grain subject to a price later, deferred payment or delayed price arrangement is not.
• 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. The commission also has the authority to inspect unlicensed facilities as necessary.
• 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.

In total, the PUC has issued grain buyer licenses, state warehouse licenses and federal warehouse licenses to 192 companies with 376 locations in 2025. A current list of licensed facilities can be accessed on the PUC’s website at www.puc.sd.gov/warehouse. 

For additional information about the PUC’s role and responsibilities within the grain industry, including links to state statutes and administrative rules, visit the PUC’s website at www.puc.sd.gov/warehouse.

-30-