Tejon Ranch, a prominent real estate development and agribusiness company, acknowledges the potential impact of rising costs on its farming operations. The company highlights the increasing expenses related to essential items such as fuel and fertilizer.
Water Demand and Allocations
According to Tejon Ranch, the availability of water for sales is directly influenced by factors such as precipitation and snowpack runoff in Northern California, as well as allocations from the California State Water Project (SWP). Currently, the SWP allocation stands at 100% of contract amounts. Given this favorable allocation, the company predicts a decrease in water demand for the remaining period of the year compared to previous years when SWP allocations were significantly lower.
Farming Costs in 2023
Tejon Ranch anticipates that its operations will continue to face challenges due to higher production costs. The increased expenses encompass fuel, fertilizer, pest control, and labor costs. The company remains steadfast, employing strategies to manage these economic pressures effectively while sustaining agricultural productivity.
Almond Production and Pricing
Tejon Ranch acknowledges that the almond market faces unique circumstances. The company foresees the adverse effects of historically high almond inventory levels on selling prices during the latter part of 2023. Furthermore, Tejon Ranch estimates the almond crop for 2023 to be approximately 2.6 billion pounds, aligning with the production levels of the previous year (2022).
As Tejon Ranch navigates these challenges, it remains committed to advancing its farming operations while striving for sustainable growth and profitability.