Overview of Grain Dealer Bond Requirements
Several states require individuals or businesses who deal with grain to obtain a grain dealer bond. The bond’s function is to serve as a legally binding agreement that the bonded business will operate according to state laws and regulations. It’s function is also to guarantee that financial compensation can be provided to the state and the public in case that a grain dealer violates the bond agreement and causes any harm, losses or damages.
In the case of such a violation, a claim is filed against the bond and a compensation is extended by the surety company backing the bond, up to the full penal sum of the bond, also known as the bond amount. In return, the bonded business that is responsible for the violation must repay the surety.
States that currently require a grain dealer bond are: Alabama, Arkansas, California, Colorado, Delaware, Florida, Georgia, Idaho, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Mexico, North Carolina, North Dakota, Oregon, South Carolina, South Dakota, Tennessee, Virginia, Washington, West Virginia, Wisconsin.
For detailed information about the role of surety bonds in business licensing, read our ‘What is a surety bond’ guide.
Read more about grain dealer bonds below, including about bond amounts, bond cost, getting bonded with bad credit, and how to apply for your bond today.
If you have any questions regarding this bond, just call us at 866.450.3412 to speak to one of our agents. We will be happy to assist you.
Grain Dealer Bond Amounts and Cost
The amounts of this type of bond vary from state to state. Some states require bonds with specific amounts, whereas others determine the bond amount based on the estimated annual volume of business and other criteria. Below you can find a list of all grain dealer bond amounts across the country.
|Locations requiring a grain dealer bond|
|State||Bond Amount||Alabama||Varies; minimum $25,000, maximum $100,000|
|Arkansas||Varies; may be required by the State Plant Board|
|California||Varies; minimum $10,000|
|Colorado||Varies; minimum $2,000, maximum $200,000|
|Delaware||Varies; minimum $25,000, maximum $50,000|
|Florida||Varies; minimum $5,000, maximum determined by the Florida Department of Agriculture and Consumer Services|
|Georgia||Varies; minimum $20,000, maximum $150,000|
|Idaho||Varies according to the net worth presented by the applicant for a grain dealer license|
|Indiana||$10,000 or 0.5% of the total amount paid for grain purchased from producers during the most recent fiscal year; whichever is greater|
|Illinois||$5,000 + $10,000 performance bond|
|Kentucky||Varies; minimum $25,000, maximum $1,000,000|
|Louisiana||Varies; minimum $25,000, maximum $500,000|
|Maine||$20,000 - $50,000|
|Maryland||Varies; minimum $15,000, maximum $100,000|
|Minnesota||Varies; minimum $20,000, maximum $150,000|
|Mississippi||Varies; minimum $25,000, maximum $100,000|
|Missouri||Varies; minimum $50,000, maximum $600,000|
|Montana||Varies; minimum $20,000, maximum $1,000,000|
|Nebraska||Varies; minimum $35,000, maximum $300,000|
|North Dakota||Varies; minimum $5,000|
|South Dakota||Depends on license class; minimum $50,000, maximum $500,000 or more in certain cases|
|Tennessee||Varies; minimum $20,000, maximum $500,000|
|Virginia||Varies; minimum $2,000, maximum $40,000|
|Washington||Varies; minimum $50,000, maximum $750,000|
The cost of your bond is a fraction of the total amount of the bond you are required to obtain. That fraction is determined by the surety company when you apply for your bond and is based on your credit score and certain other personal financials. Your credit score is the most significant determinant of bond cost.
Applicants with a high score, one of 700 FICO or above, can expect to receive the low rates on their bond - typically between 1% and 3% of the total amount. The higher your score, the lower your rate.
To receive a free quote on your bond, simply complete the initial surety bond application form. We will contact you with a quote and further details. There are no obligations attached to requesting a quote.
Getting Bonded With Bad Credit
If you need to get bonded but have a bad credit score, we have options!
Under our Bad Credit Program applicants with lower rates can easily get bonded, though at slightly higher rates. This is because sureties assume a higher risk when bonding applicants with lower scores. However, your exact rate is determined when you apply so make sure to request a quote through the program page and we will contact you shortly!
Apply for Your Grain Dealer Bond Here!
Complete and submit our bond application form to request a free quote on your bond. We will also provide you with additional details about completing your application.
Once your final application is received, it will take about two working days for your bond to be issued. We will then send you the original by standard mail, along with a digital copy by email.
Call us at 866.450.3412 if you have any questions about the grain dealer bond requirements in your state!