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June 10, 2017

Power of 10: A Line of Credit Solution

When it comes to fighting ag pests or disease, a line of credit solution may be just what the experts ordered.

The ag industry has a long list of challenges, and a pest or disease attacking a crop is definitely high on that list. Dealing with ag pests like insects and disease takes time, patience, and money to implement the steps recommended by research and experts. Unfortunately, not all growers and producers have the cash on-hand to invest in the changes, replanting, or other steps recommended by experts. That’s where a line of credit solution comes in. With AgAmerica’s 10-year line of credit, growers and producers can get the cash needed to combat a pest or disease, as well as a decade to repay and recover. Explore a few examples below.

Where a Line of Credit Solution Could Help

Fighting Citrus Greening, Citrus Industry:

In 2005, citrus greening, also known as HLB, was discovered in a South Florida orange grove. Known as “yellow dragon disease” in the Asian countries from which it hails, the disease drastically reduces fruit production and eventually kills the tree. Florida’s citrus industry harvests have dropped by over 70% since HLB was discovered, and the Florida citrus industry is hard at work looking for solutions.

Recent research conducted by the University of Florida’s Institute of Food and Agriculture Sciences shows that grove orientation can have a significant impact on fighting the Asian citrus psyllid, the miniscule insect responsible for carrying the citrus greening bacteria from tree to tree.  The research summarized in a Citrus Industry Magazine article showed that planting windbreaks, utilizing an east-west orientation of rows, and using resets can all combat the Asian citrus psyllid. These grove features are in addition to the regular sprayings against the psyllid, which have a significant price tag,too.

Citrus growers have faced shrinking harvests and growing costs since HLB was detected. A line of credit solution could help growers buy anything necessary to fight citrus greening, from reset plants and windbreak installation to psyllid sprays and other inputs. A grower who took out our 10-year line of credit could make interest-only payments for a decade while the citrus industry worked to beat HLB and get back to normal.

Thwarting Armillaria Root Rot, Peach Industry:

Peach growers in the Southeast have long been dealing with a nasty little fungus that’s found in the soils throughout the area: Armillaria tabescens. The fungus feeds on peach tree roots and eventually kills the tree. It can shorten a peach tree’s life from 15 years or so to just four or five, a situation that’s obviously disastrous to a peach operation’s bottom line.

Researchers couldn’t locate any spray or application that would kill the fungus short of injecting the tree’s roots, which was very expensive. Nor could they develop a resistant peach tree. Nothing seemed to work until Clemson University plant pathologist Guido Schnabel came up with the idea of separating the roots and the fungus.

A Clemson news release explained how Schnabel recalled that Armillaria can’t survive outside the soil. In testing, peach trees were planted on an elevated block of soil, or berm. After a few years, the soil of the berm was removed, leaving the crown of the trees’ roots exposed. That way, the fungus could not reach it. The testing showed 90% of trees planted in a berm were still alive after five years, versus only 40% to 50% of the peach trees that were planted completely in the soil.

Again, growers can take steps to follow the recommendations of the research, but it will take additional time and money. Peach growers can utilize a line of credit solution to start replanting trees on berms, and they’ll have a decade to convert their groves, thwart Armillaria, and see increased harvests before the loan needs to be repaid.

Want to hear more? Contact us today to talk with one of our lending specialists about how an AgAmerica 10-year line of credit can help your ag operation.

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