A formal objection was filed with the U.S. Bankruptcy Court in Delaware on Tuesday concerning VeraSun Energy's rejection of outstanding contracts for corn. After filing for Chapter 11 Bankruptcy, VeraSun began refusing to honor contract prices for corn offering market spot prices instead. Ron Litterer, chairman of the National Corn Growers Association, along with producers from several states filed the complaint.
"It is doubtful that we can influence the courts to require VeraSun to pay the contracted price for our corn. However, we do hope to influence other issues of concern to growers," Litterer said.
Chief among those concerns is a bankruptcy procedure that could allow VeraSun to wait until 10 days before a contracted delivery date to notify growers that the contract will be rejected. That would let VeraSun determine the market price before deciding whether to accept delivery under a contract, but it would leave growers up in the air until the last minute. Growers could lose out on their contracted price but by being in limbo it could mean losing the chance to sell corn someplace else at a better price.
Litterer says this is extremely unfair and hopes he and the committee of producers from other states can serve as a voice for corn growers in the case and advocate for corn suppliers' interests with the court.