On Saturday, Bluestem asked a few questions in How will MF Global brokerage collapse affect Minnesota's farmers and cooperatives?
Yesterday, Tom Weber at the Pioneer Press reported some answers in MF Global fallout hits grain elevators:
The collapse of MF Global is sending shockwaves across rural Minnesota, where grain elevators and some farmers are stunned to find their commodity accounts threatened by the distant scandal.
Although relatively few Minnesotans directly used the trading services of MF Global, the failed derivatives broker played a larger behind-the-scenes role in commodities futures trading. That has spread the fallout from the collapse, and some Minnesotans are alarmed to find a portion of their commodity accounts have been frozen - and seem to be at risk.
"Minnesota's farmers, co-ops and grain elevators trusted this company with their accounts, and it appears that their money was mismanaged and possibly lost," said Democratic U.S. Sen. Al Franken.
In a letter to federal regulators, Franken said Minnesota elevators are worried that those losses "could put them out of business" and that any "large loss of equity for grain elevators would have cascading effects on rural Minnesota's economy, affecting everyone from large cooperatives to small farmers."
Fortunately, Bob Zelenka, executive director of Minnesota Grain and Feed Association, reports that 86% of the money in commodity accounts has been released, although the Pioneer Press reports that he still has plenty of worries.
Read the entire article at the Pioneer Press.
Image: The Octopus from 1882.
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