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February 15, 2018

Citrus Grove Conversion Possibilities— Should You Make the Switch?

There’s no denying that the current state of the citrus industry in Florida is concerning. Ten years of citrus greening due to the HLB bacteria have whittled citrus yields down year after year and now the most recent USDA forecasts put the2015-2016 citrus crop at 50 percent of the crop yield from a decade ago.  However, the many producers in the citrus industry have decided to weather the storm until a cure or viable treatment is found, refusing to lose hope in the industry.

Many citrus producers are considering grove conversions as a way to mitigate the financial effects of citrus greening. While there are a multitude of choices among successful agriculture commodities in Florida, there are a few options that are better suited to taking over nonoperational orange groves.  Corn and peaches are two crops that flourish on previous grove land. Many orange producers are planting peach trees— which are not susceptible to the HLB bacteria— in bare patches of orange groves that once held orange trees. Similarities between the two fruit trees allow peach trees to utilize the existing irrigation systems.

Unfortunately, many lenders are not interested in lending citrus producers the funds to convert their orange groves. For instance, take the story of one life-long citrus grower who wanted to convert over 1,800 acres of orange groves to row crops but couldn’t get loan approval through other lenders. His land was going to need major modifications and work on the irrigation and drainage systems to convert, and other lenders weren’t interested in the investment.

He turned to AgAmerica Lending and applied for the Citrus Grove Conversion Program. We set him up with a $10.5 million loan to complete his conversions, and now he’s all set to plant corn, corn silage, and sorghum silage; which are all lucrative crops needed for the strong cattle and beef industries in Florida. He is also considering planting rice in the future.

Thanks to AgAmerica Lending’s Citrus Grove Conversion Program, citrus greening hasn’t ruined this producer’s story, and our goal is to do the same for other citrus producers looking for an alternative in the Sunshine State. As the nation’s premier land lender, our goal is to help the nation’s farmers and ranchers grow and succeed with our low interest rates, long amortizations, and an outstanding 10-year line of credit.

photo courtesy of UF/IFAS

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