<%BANNER%>

New Challenges to Florida Citrus

Permanent Link: http://ufdc.ufl.edu/UFE0020128/00001

Material Information

Title: New Challenges to Florida Citrus a Capital Budgeting Analysis of the Impact of Citrus Canker, Greening, and Rural Land Prices on Florida Citrus Growers
Physical Description: 1 online resource (129 p.)
Language: english
Creator: Malugen, Jordan
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2009

Subjects

Subjects / Keywords: budget, canker, capital, citrus, flatwoods, florida, grapefruit, greening, npv, orange, ridge
Food and Resource Economics -- Dissertations, Academic -- UF
Genre: Food and Resource Economics thesis, M.S.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: The Florida citrus industry provides over $9.2 billion dollars in direct and indirect expenditures, employs more than 75,000 people, mainly in rural areas, and is an emblematic feature of the landscape and history of Florida. After the disastrous hurricane seasons of 2004-5, Florida citrus production is now at its lowest point since the tracking of citrus tree acreage first began in 1966, and may decline further due to the twin challenges of diseases known as Citrus Canker and Citrus Greening, and the rapid urbanization of the state. This study conducts an expansive survey of current growing practices and collects available information regarding costs, returns, and yields to create a detailed set of parameters. These parameters are analyzed to determine the economics of an investment in citrus within a net present value framework, and uses scenario analysis to test for effects on the profitability of a citrus investment due to these new challenges. Parameters and assumptions are defined to reflect average costs and yields of a Florida citrus grove in normal operations and under the scenarios of canker, greening, and increased land prices. An empirical present value model is created which dynamically reflects the changes in costs, yields, and tree loss and replacement (resetting) through a fifteen-year period. The analysis examines the citrus investment by looking at: tree yields and costs by variety (Valencia orange, Hamlin orange, and red grapefruit), age of the grove (new planting versus mature grove), location (the Central Ridge, Southwest Florida Flatwoods, and the Indian River regions), the presence of disease in various severities (canker and greening), and changes in land prices. The effect of these variables is measured through changes in the breakeven price of one unit of production (pound solid for oranges or on-tree box for grapefruit). The breakeven price is defined as the minimum price guaranteeing a positive net present value throughout the fifteen-year analysis period. Results are presented to help understand how the challenges affecting the whole industry may affect the investment decisions faced by the thousands of individual growers, service-providers, and employees who make up this industry and, ultimately, whose livelihood depends on it.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Jordan Malugen.
Thesis: Thesis (M.S.)--University of Florida, 2009.
Local: Adviser: Spreen, Thomas H.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2009
System ID: UFE0020128:00001

Permanent Link: http://ufdc.ufl.edu/UFE0020128/00001

Material Information

Title: New Challenges to Florida Citrus a Capital Budgeting Analysis of the Impact of Citrus Canker, Greening, and Rural Land Prices on Florida Citrus Growers
Physical Description: 1 online resource (129 p.)
Language: english
Creator: Malugen, Jordan
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2009

Subjects

Subjects / Keywords: budget, canker, capital, citrus, flatwoods, florida, grapefruit, greening, npv, orange, ridge
Food and Resource Economics -- Dissertations, Academic -- UF
Genre: Food and Resource Economics thesis, M.S.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: The Florida citrus industry provides over $9.2 billion dollars in direct and indirect expenditures, employs more than 75,000 people, mainly in rural areas, and is an emblematic feature of the landscape and history of Florida. After the disastrous hurricane seasons of 2004-5, Florida citrus production is now at its lowest point since the tracking of citrus tree acreage first began in 1966, and may decline further due to the twin challenges of diseases known as Citrus Canker and Citrus Greening, and the rapid urbanization of the state. This study conducts an expansive survey of current growing practices and collects available information regarding costs, returns, and yields to create a detailed set of parameters. These parameters are analyzed to determine the economics of an investment in citrus within a net present value framework, and uses scenario analysis to test for effects on the profitability of a citrus investment due to these new challenges. Parameters and assumptions are defined to reflect average costs and yields of a Florida citrus grove in normal operations and under the scenarios of canker, greening, and increased land prices. An empirical present value model is created which dynamically reflects the changes in costs, yields, and tree loss and replacement (resetting) through a fifteen-year period. The analysis examines the citrus investment by looking at: tree yields and costs by variety (Valencia orange, Hamlin orange, and red grapefruit), age of the grove (new planting versus mature grove), location (the Central Ridge, Southwest Florida Flatwoods, and the Indian River regions), the presence of disease in various severities (canker and greening), and changes in land prices. The effect of these variables is measured through changes in the breakeven price of one unit of production (pound solid for oranges or on-tree box for grapefruit). The breakeven price is defined as the minimum price guaranteeing a positive net present value throughout the fifteen-year analysis period. Results are presented to help understand how the challenges affecting the whole industry may affect the investment decisions faced by the thousands of individual growers, service-providers, and employees who make up this industry and, ultimately, whose livelihood depends on it.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Jordan Malugen.
Thesis: Thesis (M.S.)--University of Florida, 2009.
Local: Adviser: Spreen, Thomas H.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2009
System ID: UFE0020128:00001


This item has the following downloads:


Full Text
xml version 1.0 encoding UTF-8
REPORT xmlns http:www.fcla.edudlsmddaitss xmlns:xsi http:www.w3.org2001XMLSchema-instance xsi:schemaLocation http:www.fcla.edudlsmddaitssdaitssReport.xsd
INGEST IEID E20101112_AAAACU INGEST_TIME 2010-11-12T15:52:19Z PACKAGE UFE0020128_00001
AGREEMENT_INFO ACCOUNT UF PROJECT UFDC
FILES
FILE SIZE 24597 DFID F20101112_AABUEX ORIGIN DEPOSITOR PATH malugen_j_Page_028.QC.jpg GLOBAL false PRESERVATION BIT MESSAGE_DIGEST ALGORITHM MD5
736f02266e91822a3c67aa0fa8916ac5
SHA-1
a574003a90c2f7bc74ba6371becb97245607c350
1979 F20101112_AABTZR malugen_j_Page_016.txt
105e6f127cf2010f190022a2c4177954
f9b40f29b43b278d74514bafd6709c70e65613e3
25821 F20101112_AABUGA malugen_j_Page_043.QC.jpg
244cbe922d27c25180f483f8e22bb149
71e15457a9846c8f9b0412327be07f3327d90910
24581 F20101112_AABUFM malugen_j_Page_036.QC.jpg
50778237d4a8dc1eea20fd40fca1ccd0
6bc97234e2b436af9d34e3b9eccc8d0083eb5832
22022 F20101112_AABUEY malugen_j_Page_029.QC.jpg
02fadcf61171df235b29bbabf1acaf0f
ac377321fb432c834ccae9dc5c71c30d761d63d0
2222 F20101112_AABTZS malugen_j_Page_017.txt
b640727d351ed070745bfc006ec9a39c
9dedaf6c06ba31399d7fc944a9ff2f831f0a535c
7020 F20101112_AABUGB malugen_j_Page_043thm.jpg
75c0388fc5f8b48cf9e4f548116d58f3
ba456145ecc4fd0348470dbc148168abf9f44188
6786 F20101112_AABUFN malugen_j_Page_036thm.jpg
c5dbe6600a2f62868684c6d56370e540
6b9df9aeea7f5a45331a9e15f239d6fa92193b7b
6104 F20101112_AABUEZ malugen_j_Page_029thm.jpg
99c18ce8c89cdab0a7bea2ab09bfa4df
ae3576aed4729c8254fcb63ebfafa91fabfb704c
2177 F20101112_AABTZT malugen_j_Page_018.txt
df9bb212bc91a6816a2bb7193230ff4c
c8828275704713b482ebc22190d6daa093f22325
1053954 F20101112_AABTDA malugen_j_Page_073.tif
f1b3f58c6239f41ccb0c0021329d772b
77c6f9a21c6f08b5dc8800f14099678e592ac7c8
24082 F20101112_AABUGC malugen_j_Page_044.QC.jpg
fcdf9a9877b9ca3ec73575ef13d67c18
15b281992132c468ffae80f265e4fdda76a17a7f
24191 F20101112_AABUFO malugen_j_Page_037.QC.jpg
7a5f3735c4e1c0cb3fe4cdce082b7531
ce75b02e73bfe56faa6fc93d9762772db292acf1
2567 F20101112_AABTZU malugen_j_Page_019.txt
93a4435354d7684f2bd03f352647112f
b5339929de23713864f0410b07e541bae5c0821d
1054428 F20101112_AABTDB malugen_j_Page_113.tif
99907caefe5895a33833b201f4ab0f51
716329295b4d5fc18824d0fb50e83f911831df50
6477 F20101112_AABUGD malugen_j_Page_044thm.jpg
323e8f964c4281b786cfb0e5858008a0
2685c0b28e170c63fc46e4ee16cbbb90c530f3a8
25271604 F20101112_AABTCN malugen_j_Page_127.tif
354eeb3651994df85226ab71139bce19
d580ae617017faa82437c3c00af42eb3857d4205
6709 F20101112_AABUFP malugen_j_Page_037thm.jpg
c5ed07f99b51b41f97036abdae41cf90
6117acd2bcc86e9523821172d0abb72c97ca2194
2038 F20101112_AABTZV malugen_j_Page_020.txt
3116f333b1ed04cfe069050f0a4b92a6
ef7c386b0e927c156ddd1f88e0775de75cf94b5b
3382 F20101112_AABTDC malugen_j_Page_014thm.jpg
c45ec3294370440b3c01fe768122934d
81d3b8c3670145835a7643c7722650c1f81a5a96
12463 F20101112_AABUGE malugen_j_Page_045.QC.jpg
c1e86603bbe37d837f9e8abfb7cd56e3
b5ee49c52686a7169b2f4a262ea3254cbaf73e16
20903 F20101112_AABTCO malugen_j_Page_070.QC.jpg
8ad2a89c1dc3f5e37b1fe42a0cfe4fd1
64ecd9bd8619dc0751d9d6f0951d18685fada607
24290 F20101112_AABUFQ malugen_j_Page_038.QC.jpg
b3f2452ec9d078c4c241af4715d10732
8126d48e29b1e5c4b624183a738bc5dc1930ea3a
2263 F20101112_AABTZW malugen_j_Page_021.txt
670eaa29e597fe5b012395033d51d860
9c9d7dcc677ff38c9f157afaea0f33ca0dbc177e
7025 F20101112_AABTDD malugen_j_Page_080thm.jpg
da02b90339369bec184f16a5fab849ed
af614c15630f7855a8e3995a1d4245b12506001f
3561 F20101112_AABUGF malugen_j_Page_045thm.jpg
6b1c2b6316742d54545258c240a5f0be
a6c6596bf609867c3b25a4a84c5215be534b3e7b
23993 F20101112_AABTCP malugen_j_Page_063.QC.jpg
4910b525f64fb700e657411298c2133c
674dbd1784e6a3480205f33c79fde899d52258dc
6593 F20101112_AABUFR malugen_j_Page_038thm.jpg
c464d9f19c5c5a88bad85abc8028fd7f
aaf00d777b2cb6fa328f6b7c5420dd4966ef7208
2188 F20101112_AABTZX malugen_j_Page_022.txt
8fe38a36a4eac0ef80d59c8a3143cc9a
35d97409513299d028e11fcfddceff6e63d3456e
19780 F20101112_AABTDE malugen_j_Page_104.jpg
53e322862ac997fda405b2b450d43003
22483323ccce929c089c3ebb674940d2ac75db72
6693 F20101112_AABUGG malugen_j_Page_046thm.jpg
212f696ddb64b6ad0a4ed67b0688f7be
95ec3ecf6fd29f43bd4359c8aaa42b006826cff6
7113 F20101112_AABTCQ malugen_j_Page_081thm.jpg
ff776ce67cb5a1793a0d3e2376e54676
8903f55ea1fd60411721773aeaa5c6f68d7bb1cb
19375 F20101112_AABUFS malugen_j_Page_039.QC.jpg
5958895571affe6e5e70083cc947526a
fad310cbb9c2bbd541beac5c9c79ecc348624a17
2169 F20101112_AABTZY malugen_j_Page_024.txt
3d354c9027f896d827d0c13f8d35277b
fee0779715870ee5dc1cd0e00f453106f9808014
1317190 F20101112_AABTDF malugen_j.pdf
62d2668cddfb6828ea05f3df28947eef
76c9400c6033dc6f956342da3f0970569e6968c8
22469 F20101112_AABUGH malugen_j_Page_047.QC.jpg
dde3798279f5f1ba6ed52f49d4299e6d
5cd644e48c7fc94bce788e63309e7eb4181d8a3c
96165 F20101112_AABTCR malugen_j_Page_087.jp2
36abd1e9408d2fcdf78f36059f7cdde3
a7b17f90f9c6d6ad636bcab6df0d8e4ee3556cbe
5348 F20101112_AABUFT malugen_j_Page_039thm.jpg
2d07aa627163e0faa9417cd2ebcb1c4d
4014fa4915627f28057f6ee80e1e79729be88216
2418 F20101112_AABTZZ malugen_j_Page_025.txt
ab25a0f60288c4f5daf9b4cabb6a8fdd
e70c98f06f8d69ae280233b75dcfedb427088d51
11013 F20101112_AABTDG malugen_j_Page_014.QC.jpg
0b0f2361accfe2ee4964d8956a764e0f
bfbc3121cf54d80c13be05475eae6fb7356ea110
6207 F20101112_AABUGI malugen_j_Page_047thm.jpg
1f72f146fc34d90961cd6ef55709275d
a6c100527c55c082990379c8d0b43335ac71a91e
27344 F20101112_AABTCS malugen_j_Page_019.QC.jpg
00d69067ffe5e78aa3a2a63753969826
032d0bacb646bc80d163aa0d2269e562cea4abb3
18841 F20101112_AABUFU malugen_j_Page_040.QC.jpg
83086ef4a1f7f7010ba941a40f783364
fe5fbb9323f1ccb0ea3770d7bb6982c35a393e81
115830 F20101112_AABTDH malugen_j_Page_086.jp2
746b31f3b5cc9472275b8644302c7d68
06a610e93a06f27452f448dc0290a26a25779bbb
16607 F20101112_AABUGJ malugen_j_Page_048.QC.jpg
5eba1c9ccdd928bf376c85c7fa5bd8fc
ed4857dd64df7cf86c963a26d42799f230175e42
25632 F20101112_AABTCT malugen_j_Page_093.QC.jpg
cd52fe7a7b01fa2bf090edbfdf70e72a
22f5a066c383646ceea7a64cbed8f608f632e578
5413 F20101112_AABUFV malugen_j_Page_040thm.jpg
6272f4a7ab64ef9c87d93bcdd076c468
994b46af9f552f85f1d98790c7c1753426cc8a33
92022 F20101112_AABTDI malugen_j_Page_029.jp2
7712168d37ac51c4f88596f10dc25a97
4c2a91cce49a9e190834da903208d1bd9efab644
5362 F20101112_AABUGK malugen_j_Page_048thm.jpg
e22b3ec273c8eb8ad86c80bbff30e192
37a2eb02fe6b252ea8071f8fde4766ed8cdc5e0e
F20101112_AABTCU malugen_j_Page_019.tif
2d0f6fdac5e942bf2c1bd6c1bc1b4de1
cd0451a37933b9b06c24015bb08c3275f312f777
18550 F20101112_AABUFW malugen_j_Page_041.QC.jpg
946dc96c7bbaac269cca1f6f00dd890b
68315f3c31f0e432b6488b2cfb7b99a10b522cc8
6165 F20101112_AABTDJ malugen_j_Page_052thm.jpg
c918eb95d245f828304f6b415b980a4d
022cd225b98884d3db187447de55040f37daeb8b
6626 F20101112_AABUGL malugen_j_Page_049thm.jpg
b1cc6e4b22d434c917c25fcc40e6616e
258b86b579586ee019bca2c893c3da4b6ebc60fd
5580 F20101112_AABUHA malugen_j_Page_058thm.jpg
7846286bbc4ac13855218e4d200ee877
a54cf70fc5165ed71bc31a502ea8961ec4628e24
16217 F20101112_AABTDK malugen_j_Page_121.QC.jpg
c896d5e81d588f954701a341dd97057e
2b6c1484c320071f48cbc7de69aed64fec3bfcd9
5842 F20101112_AABUGM malugen_j_Page_050thm.jpg
b7ecd09e64d4d6aa8e9cb8028e01de5b
3eff60c245e5b69e44087fac0b55c73e43744509
1889 F20101112_AABTCV malugen_j_Page_070.txt
1b4b15377a5c02420c30c742a2955de0
d443f43b95515631d0751767090ab30e45737e70
5465 F20101112_AABUFX malugen_j_Page_041thm.jpg
1542b297a9edcb18705d80b11023aeeb
1dc33d4668e1bfff9a5770052d4dd8c751371eb5
26092 F20101112_AABUHB malugen_j_Page_059.QC.jpg
33f25b5c44eccd94ef73bb37edd26304
a5c150feebc23f25c18ae73973f0d8a3ce8068b1
6676 F20101112_AABTDL malugen_j_Page_067thm.jpg
346f1994ec6a593674d9c8ff4645f3c6
be3bca6e60259bb197ae0b368f0ccdf6c4edf6a6
24598 F20101112_AABUGN malugen_j_Page_051.QC.jpg
4eddd186f44f039686de7779de882ca8
77902de3d2366ffb6817a48f66277d563b1767cf
79205 F20101112_AABTCW malugen_j_Page_064.jp2
36992864f4d916e4747d30b36e3bb5e5
283f39727c8fd1332b01a485c4ceb0c8e6cc7aa3
17819 F20101112_AABUFY malugen_j_Page_042.QC.jpg
215908682ebb176ff6b12c50f6ebc6e2
82dae150e3aa0ea31c6950adf8a55c65ea1905f2
7016 F20101112_AABUHC malugen_j_Page_059thm.jpg
22cd947c2a0c94fbeff7162aed079cbd
c41f568c55ce6ef315d151cc9c5a39eb920ede63
55685 F20101112_AABTDM malugen_j_Page_064.jpg
06e96b736d79365fa6382af70b7185d7
a94f0cbfe1a9bb61208c23cbe873ae368f078b34
6960 F20101112_AABUGO malugen_j_Page_051thm.jpg
6c3ec08b9c0f2f2350ebcecd9647346f
42aa646373fd8596aba46325761bd732514f8a45
20130 F20101112_AABTCX malugen_j_Page_078.QC.jpg
01dcecd54ca539ede419936acf340e03
1e9752a9cbcebc45ebf249421c65c246d1612070
5448 F20101112_AABUFZ malugen_j_Page_042thm.jpg
78a2aaf1b38ea6cfc2331bf735986926
065455c149cf2ea38060d6909b37545a5ca54108
2145 F20101112_AABTEA malugen_j_Page_023.txt
414ae1fe71159663fa78cce6630c9851
987049c3819dcb9050ddfaff3aeb225e88ac244b
23390 F20101112_AABUHD malugen_j_Page_060.QC.jpg
27663e058031a20e18964c3de26bae10
373fbea1b075c36bb542ffe567a7f166ef5bf9cf
45116 F20101112_AABTDN malugen_j_Page_088.pro
50c3624732594070d7878a2816474648
8543ea38601aa96d6b78b3e982ce035c30cc4bb4
22536 F20101112_AABUGP malugen_j_Page_052.QC.jpg
b370defbc9ea0249bce806b0664f2eb6
9427a6746d7a827a7b1fc9828c1396a725f03533
58209 F20101112_AABTCY malugen_j_Page_128.pro
2978a276217798126e8272c7ffd2e896
33b06fca8c5e82d2d53b62a0c0b0437841fac6a7
54745 F20101112_AABTEB malugen_j_Page_081.pro
bf420e88f0d541c180f64403ad295483
47d2e18201f3609cecb2a623258308471c60c12a
14939 F20101112_AABUHE malugen_j_Page_061.QC.jpg
01d202848fb4504325aae09417cacd94
4efb2151384ecd3f16bba9871b177026be47c65b
F20101112_AABTDO malugen_j_Page_047.tif
843bb2dc97171917dfa68add41b3e312
e36b93ddebcbac09c693fa3af74f0f854fc3cbd8
21396 F20101112_AABUGQ malugen_j_Page_053.QC.jpg
704ec802b3a28b7e351e7d19a850866a
ad22ab24d9218ededdf884705e4183903778224a
122316 F20101112_AABTCZ malugen_j_Page_108.jp2
44d19dada7e019f859e1e4e42641ce48
656973ef358526a4bd2e008ef917d48b85298d51
5904 F20101112_AABTEC malugen_j_Page_065thm.jpg
e9dde5213cfc56580ec7a387497c400d
04d5daf224138bb547cd33bc9f30d9ac7645359b
4399 F20101112_AABUHF malugen_j_Page_061thm.jpg
2a1760e589c049471051a211e159ee71
2bc31d73ec916d5df5789604768788a83a5ec17e
25889 F20101112_AABTDP malugen_j_Page_012.QC.jpg
f4660a11449b2dca30e8eeab38c24371
6578fbae3787711f7e7fa6f222105918765ada6f
6111 F20101112_AABUGR malugen_j_Page_053thm.jpg
a574cc5c2635079f561f103c7acfba05
e532e0aeeab12f73e7dddadc51fd1182cf4402bc
76411 F20101112_AABTED malugen_j_Page_071.jp2
6b441223b70c8a76d5821284ca6d4ce5
9c330c1861ef698642f2c224020b18421394d1a9
5315 F20101112_AABUHG malugen_j_Page_062thm.jpg
f7f768950f225b5e455664b6884e713e
5d7736a2fdb763c972851e1843b9dbc3f73b7e0f
5820 F20101112_AABTDQ malugen_j_Page_002.jp2
2173362321540232553a79fedf6ed1ff
446a0cb337efe4ec148d50c4b5ced49bc04cd75d
18077 F20101112_AABUGS malugen_j_Page_054.QC.jpg
9b605f40104d5ea302805baca2c5274b
64a6cddd63ffe99d283ea0e24d112f54c804b5cd
28291 F20101112_AABTEE malugen_j_Page_061.pro
8e069b0faf1d0ce25079444bf5ef16fa
4af05dd2196e40959f4070afc1cba65b15e214d5
6631 F20101112_AABUHH malugen_j_Page_063thm.jpg
79d837de6e77dafc6919ebda3c897ee4
2c9454977ba968bbd43262b967620a50bfc708fd
19015 F20101112_AABUGT malugen_j_Page_055.QC.jpg
8c10dc1179edf09bcaf100abe72a165f
630f652ef374134e29250e5433bc0c9f49629c8a
62366 F20101112_AABTDR malugen_j_Page_008.jpg
8ac150b1c74a7e9f4ce44b3c41aa1f56
39d847e3a2417c5a78b437c53c0acbb110928bd3
2025 F20101112_AABTEF malugen_j_Page_051.txt
3a037a61b70319f8768765b3e5c7af76
59880caea98c3bee339f0d768833d91da7f4f0d3
18225 F20101112_AABUHI malugen_j_Page_064.QC.jpg
0d68bdb3b60852639dc93751590e24fc
7c818f363ad8cbc1fbf580654bf0d37fe942c01a
5696 F20101112_AABUGU malugen_j_Page_055thm.jpg
9bdae165dfba6ecce975b0396574dfca
4054eadac9764ae254de5f2d29ea2a0a7751a9e4
6887 F20101112_AABTDS malugen_j_Page_028thm.jpg
0238cf609492a973c3752dbe8ea55bf1
5eed4e53997f2a2fe1f823eed272f9181c03490c
2211 F20101112_AABTEG malugen_j_Page_095.txt
3eade3763f39586acb2807d7dc334726
de0748dcb0456685574885f5dc83bc1bd3fbde3c
5403 F20101112_AABUHJ malugen_j_Page_064thm.jpg
2d657edbc9e8246f3d352ff0d6422889
dc2d72d3cbe166b936258ff9a08a856ef7ec1553
24361 F20101112_AABUGV malugen_j_Page_056.QC.jpg
57e2fd95efe77b13e89949ed137e3fc8
b5e8e7ec9594882539c039209bb1809d3c36d551
21895 F20101112_AABTDT malugen_j_Page_069.QC.jpg
254d62586121da865c5f6778c6c05193
fd07c8edcaf1dbcd1f1bd7a00056759b55e675b7
F20101112_AABTEH malugen_j_Page_044.tif
030efd0af7170d5093f945483cd4b6f4
ada416537d71eda0276b50fb89e46107a0367dab
20783 F20101112_AABUHK malugen_j_Page_065.QC.jpg
3c5da2063a8b65245b89d2493cfaff43
697317919375317f6aebb40c95dc66e2cd6ea307
6771 F20101112_AABUGW malugen_j_Page_056thm.jpg
85a8021015192da26d8432e9eacc8853
10a175fadd4e266a84bcee697a25d36cb42b84f8
75784 F20101112_AABTDU malugen_j_Page_097.jpg
e20555ca13c86165f79021fe7ffebf9d
e3fe3163978da2f3b4f9925f6ad5551a5fdf7d41
3300 F20101112_AABTEI malugen_j_Page_118thm.jpg
b48ddf1cd7b503f11d7ddbaf951913b5
978b62456a82b12d2e888fa8a99eaa85d9c9f07a
18123 F20101112_AABUHL malugen_j_Page_066.QC.jpg
c9384f2c4afa04c7d52d8cab133ae8c2
5666db1114748b99e4a39219c1b4569c1a4a1590
20632 F20101112_AABUGX malugen_j_Page_057.QC.jpg
92168fe41875df32bff9865275fea65e
c7785c79e100e5b9a43b7fab41374c45edc6e4df
47969 F20101112_AABTDV malugen_j_Page_098.jpg
f76323482dd54b8a09b4f202ebe48603
c15b15df8538a89a7d4c301e8d47dfa42d6c1881
48149 F20101112_AABTEJ malugen_j_Page_052.pro
6f3a7ec091444bbeebd8786d84eea396
cd60d91ca431677ad1f6c9c893f2011176d4af54
5592 F20101112_AABUIA malugen_j_Page_075thm.jpg
3a46a4cf1234dafd4a7d70f8ef5567f8
13759094f44f4813ede29f4b3a58ee220ce66864
5461 F20101112_AABUHM malugen_j_Page_066thm.jpg
b5dc17038691780e7652d9758ffdd157
034e2741420f98f75bf4975bc7b77f6a93fb7eb1
6933 F20101112_AABTEK malugen_j_Page_073thm.jpg
a85a82cc1fe237ce8b41a682eefa0a71
b561039426b5c6ff9915e7c0c5f032aa93a7806b
25259 F20101112_AABUIB malugen_j_Page_076.QC.jpg
ac504d7a3770356caa6aee3a6de76e42
326ca3d23a4741a1e828d96cf743cb9508bae25c
22952 F20101112_AABUHN malugen_j_Page_067.QC.jpg
5815236e3eb3c42538fb1432460ded8a
067325d25920bb00ec762d057c30391af4812ce4
5882 F20101112_AABUGY malugen_j_Page_057thm.jpg
8fd02b4f166f4e0f4944af0a7fca703b
550a9c591290a98ae492ddfdd18f0c73da4088ac
24560 F20101112_AABTDW malugen_j_Page_086.QC.jpg
4b387bdf7774e1fa1bca0d9ade1f664d
c0c159b3d5b9af185c178b422932f4737f9103b2
27686 F20101112_AABTEL malugen_j_Page_001.jpg
19b16f2daf758e1cf6002125efc72548
c20e24a909288198febad4e9f755c76769ae9e71
6914 F20101112_AABUIC malugen_j_Page_076thm.jpg
e4b0aafc6a5760af446113380f99cd42
51c36697334d11f442d975d33f7ea2410d0aeecd
21327 F20101112_AABUHO malugen_j_Page_068.QC.jpg
97bd71aaa41be2225ae36c2b3b41aa99
7404ca45508f50e08e2c46c53cf5447d12056822
18424 F20101112_AABUGZ malugen_j_Page_058.QC.jpg
623f6979ed9e45eac4705ba58e44a635
dfcbf6454dea9da5135da77abde3cdadb453d434
43523 F20101112_AABTDX malugen_j_Page_070.pro
21e46013b62e6954faa037fedb653bb3
f6a135b8e6825ad02dbc820057fb5c792fadb789
3228 F20101112_AABTFA malugen_j_Page_108.txt
adca18e116ce2301c3b31d51500711f9
e8d1cb3b13333e3385c125857bd0a64d71c32100
76953 F20101112_AABTEM malugen_j_Page_081.jpg
c07b783fe8933cf9c88ffbbbb23b89fe
d8d91ac173c9186fb63bcb82f9f8bcf19bfba251
20819 F20101112_AABUID malugen_j_Page_077.QC.jpg
8b9597d82a4fce6d69083a405cfd9862
dedf5c94f3637ec80c0e4fce1573372fce05889e
5950 F20101112_AABUHP malugen_j_Page_068thm.jpg
468c5bdfe6ffca5e0695a8ff528686f9
ad5e15ed50fffc83215b062b2b8fa87662766323
6656 F20101112_AABTDY malugen_j_Page_027thm.jpg
c3056f1e712deb4696a54102eeb663eb
0bc5339daf8f520d2125de28c02145d29781dcc8
17865 F20101112_AABTFB malugen_j_Page_062.QC.jpg
a6039c5a11f4e37a31630683afc2bdc5
26e696a5ab2f6deb8db933ac5f3feadb1449396a
15884 F20101112_AABTEN malugen_j_Page_098.QC.jpg
645b4f7d4afab64f40f7aad987dbf864
dac1bba28aa0cdad0050ac7878a8681a76d24bd5
5953 F20101112_AABUIE malugen_j_Page_077thm.jpg
4bff431d21d96ac52a3ca6381e12fd8a
01371be12e1421a2bda5e39e330ab151d199e023
6245 F20101112_AABUHQ malugen_j_Page_069thm.jpg
58ef83542d5e3a8e189a9930e43caf51
3d9f1aa34a8ac2099d71ce9e240d3cae24bd85bc
F20101112_AABTDZ malugen_j_Page_048.tif
0b2236919d4936a0581de34c0e9cc616
cd31fce26bd0ffc9191f32b296d423bd68a12e1d
1926 F20101112_AABTFC malugen_j_Page_053.txt
aebf493ea714ddc5913b3402e3c25c32
1f4fcb65d1ae4852aea7430ec3b70dba0214f026
1394 F20101112_AABTEO malugen_j_Page_118.txt
2f91b610a4300db3ccd79352b4dce762
2627c51449bc8ec7e05fb41b339f3eed6ed5607c
5770 F20101112_AABUIF malugen_j_Page_078thm.jpg
3ad5a2cbd322b74776908a63ba533466
a8a955315b0cd041c6979dda5c52266927b33341
5865 F20101112_AABUHR malugen_j_Page_070thm.jpg
8ca5a9b79584eff154e5eb1c5f3dccbd
59ec947a66bcef02129cbceb12587ff221270be0
61707 F20101112_AABTFD malugen_j_Page_078.jpg
9016e50b751749594dc5aa214f4c8a36
1b8c7d03321b980ca992c08d54e6d6df84a13fe4
91049 F20101112_AABTEP malugen_j_Page_075.jp2
9b660213f72b2d08dbedf86e2f33030b
197ebe28275dbb8ae84485412556c47b7716d7b0
21068 F20101112_AABUIG malugen_j_Page_079.QC.jpg
2d7f628b9d2cd3f609fa83bd4e5b231c
d8af5eed34ecac82182ea0b9e2fe432b4b4715f4
17311 F20101112_AABUHS malugen_j_Page_071.QC.jpg
13ad4f87141dd3cb3cafbe0bcbe6b1b5
50abfa132069e7560ef8c022804f74d91dc363cf
86235 F20101112_AABTFE malugen_j_Page_019.jpg
7eba3ad039df45de2512a0b62bd28fc7
96d04e3476e590b31015f6f7001d46bca181df1b
111926 F20101112_AABTEQ malugen_j_Page_035.jp2
c76487b69f65765cdb2f990cac661abc
2381922c9cfa614aeb835a7ec5892526553e4885
5760 F20101112_AABUIH malugen_j_Page_079thm.jpg
ac34926fa5d22ef2ca3ecc7c15e67aac
da211e224a26eca4cad48a7f79fb47c7b29354f0
5122 F20101112_AABUHT malugen_j_Page_071thm.jpg
dbf5530228dec608bfe6ea794f7152fb
6c932c33a02e64e225f23b0234d967da625b8bea
F20101112_AABTFF malugen_j_Page_062.tif
b343c758021c25eeb7ae334e87e36abf
d9688dd168094de7f2f4ba281332475fd8753909
77383 F20101112_AABTER malugen_j_Page_095.jpg
93a245b3da9e94a04fc8bf10aa7e2399
517ef96b247b68dfcd5de5b3ebf2924ebe82bdfe
24587 F20101112_AABUII malugen_j_Page_080.QC.jpg
5706ec204302c701ab6cd06be9fc8b8c
018f83551b4b70a383203486845f2f419fd49aa2
24134 F20101112_AABUHU malugen_j_Page_072.QC.jpg
6f200c36eae83038bbd0f5407c251c71
9a56543953f11935648718be54453a533551bf26
F20101112_AABTFG malugen_j_Page_041.tif
7db6394569ab703f883104242d47a82e
b1e11f0d6099e7bdbd13a5c8a3bb567f3c6c9660
72669 F20101112_AABTES malugen_j_Page_037.jpg
632845a407ac1ca7ec7ce1d1460af796
539c13c7ec35c814a2066d35ba9e49b630bbaae1
25174 F20101112_AABUIJ malugen_j_Page_081.QC.jpg
fcba98f6693d2b43914688653df8a25a
c931a9ae2d639409d8bc49825f852e236e17cba9
6564 F20101112_AABUHV malugen_j_Page_072thm.jpg
4bb9656cd63f358eb65f9149edb35504
02a4e6cde89ee9d1dcd01c7561eb2ee250a82525
33900 F20101112_AABTFH malugen_j_Page_118.pro
ad259ff401c7266acb5fdd075f34f8ec
cd86f11ca540accced36737cff2f02156f9c92e1
40299 F20101112_AABTET malugen_j_Page_062.pro
f7f573f8984100c55140ea6076bdcb98
4b28889a5c298cfe39a794fc35ee689ab73269cc
11534 F20101112_AABUIK malugen_j_Page_082.QC.jpg
32c1b617541e78c281e00b8c63cd28fb
012a9fd0c10717854745d7a443647845572bdc34
25017 F20101112_AABUHW malugen_j_Page_073.QC.jpg
577945028e4368884db70a9298eeaea6
17f0773f0ac32e6e6f72769f259d99b35872597a
F20101112_AABTFI malugen_j_Page_010.tif
18b2a9e8ba296b98f1709cf43a3fa7e3
74ec113bb3f98503edf212966904457799626786
2139 F20101112_AABTEU malugen_j_Page_049.txt
4789ae6b0e264a661f8bb004168dc28c
1bacc20fa004b52979d79168410597f246d0f886
3577 F20101112_AABUIL malugen_j_Page_082thm.jpg
db584f435bc65657aee0fe2e9ba07b09
f7d45b4c0d9ba82e80520f3f357c4c932e968197
20503 F20101112_AABUHX malugen_j_Page_074.QC.jpg
3d0f5d69b5e763512a5df0dfac36efd0
c712eb290f6dc18830c085f1ae08875125eb3e97
93459 F20101112_AABTFJ malugen_j_Page_128.jpg
1ec71102c81d950817c5c9241670ca84
00e1b67bf48e65d2c7c93c5a3efd13038a5d7f0d
114455 F20101112_AABTEV malugen_j_Page_097.jp2
8437958413a06a0d9c793434e28e3b6b
c2a458bfabfe6affec553cbce30bd7be3886390e
6775 F20101112_AABUJA malugen_j_Page_092thm.jpg
edd490df80f4acb4eb884ab83213da5c
1d60bbde6676be70d6b35083378f0d545aeb7438
24242 F20101112_AABUIM malugen_j_Page_083.QC.jpg
437e9036f75aaddca5fa5bc2518f6672
7aa771b3556a674e454ee499c65d10c6128dc262
5873 F20101112_AABUHY malugen_j_Page_074thm.jpg
78b44671e3a725518ec752728135598d
190d00361aa6042a54887d0359cf0bd4b21f68fe
2040 F20101112_AABTFK malugen_j_Page_085.txt
9aec311bbc01181ba25d121183bc777e
c335f4a99bbbda776d89b019a2a8d55639c54ea5
119255 F20101112_AABTEW malugen_j_Page_030.jp2
8cbb0e2ad37ce3ebf3d17835d2d415b7
c7fc8dccf1d156bb9a086ac5c8c86439309b1a7e
6858 F20101112_AABUJB malugen_j_Page_093thm.jpg
4f6d5af2876a481d4642f6f4afc6a7d1
6b5a3773193ee37418f5a729c5e532c4ffb49677
23847 F20101112_AABUIN malugen_j_Page_084.QC.jpg
e4a2ca6183d64a1234eacc64a52c4c09
b4e5dd14c233067b2ad2d44703d77c9a6d317620
6068 F20101112_AABTFL malugen_j_Page_009thm.jpg
3f64be6baf80b15c09ff029c464dea7f
b5c543745f8756f5cdacb8441de3b50a07e6d405
25905 F20101112_AABUJC malugen_j_Page_094.QC.jpg
62b7e6c7b7c2e4d14fd524dc26993517
bbf127aef30a77ed1534cea61a104b4c966e5397
6723 F20101112_AABUIO malugen_j_Page_084thm.jpg
5160198833f94d1dcf5cae9a74c83ccf
6f3bd7c8e69206c0066bad45f3a8c19c5b2c98d8
20357 F20101112_AABUHZ malugen_j_Page_075.QC.jpg
50b4797f515a7e767f244c27ded258dd
636c8003efef71153a70aa912452d9aa79a72be1
F20101112_AABTGA malugen_j_Page_009.tif
c6da9b0548644f396243414fbfd08089
2ce03702c35291ba3494e6c7cc21e21b903ff3a6
53102 F20101112_AABTFM malugen_j_Page_048.jpg
2802c4b513bb96eba803b39ceaacf63e
a6650f135112b2db95661b43c790fc79b33c63a7
7006 F20101112_AABTEX malugen_j_Page_083thm.jpg
50e378575c7e3b767e95d8c6fd78db91
e8160a647857ae3d29cac18d9abd40b78df77fea
6964 F20101112_AABUJD malugen_j_Page_094thm.jpg
5dea211c7b3c743fff8a685aff979b2a
a89b64f20e2286547f0c8854d3aa7c2e8d2d69a9
23736 F20101112_AABUIP malugen_j_Page_085.QC.jpg
928ae11a858beb1b1106b4de5e367241
aa10f3f682b781f278c159560cb12ff8bb003032
23870 F20101112_AABTGB malugen_j_Page_006.QC.jpg
c02c2a9baa5ffb0ce83f563322e0a9ef
dd5127330aea121246fded336ea303b19203e946
51197 F20101112_AABTFN malugen_j_Page_111.jpg
5fb8d841f93bdace86b1ba128677e2a9
9761dd1e18259b6a96c2ac5eece7b6812ed8c306
111141 F20101112_AABTEY malugen_j_Page_020.jp2
0f093908657bfc699390e143f95636a8
c68ce288fda1b2f0eaff6e4c15bf5743792ce513
25567 F20101112_AABUJE malugen_j_Page_095.QC.jpg
a647f3ce7aaba68a142593e890e0907f
0a2115171519eee6b1223f88961feebb9870706d
6447 F20101112_AABUIQ malugen_j_Page_085thm.jpg
5e5cc73a41a0ef2c81ab4613e7984186
7681704bed6973641c3e576c68675d1ae11416ba
107690 F20101112_AABTGC malugen_j_Page_096.jp2
ff40e547295f8463ea1c8728d65272ea
157fe6334527ad33fdf8678f65d153cc4285586c
79224 F20101112_AABTFO malugen_j_Page_059.jpg
8f446562823e81fdca39582aec568f1a
43e45f5e6486e7c215f43ee2884c6ec90473d3b8
106735 F20101112_AABTEZ malugen_j_Page_067.jp2
969dd597ec1ec345df1185818f6d6363
d3922ef2021be677e4266b30d6e3567acadfeee5
6946 F20101112_AABUJF malugen_j_Page_095thm.jpg
8a95e711326494f58825ba2383b6e4dc
fb7c7410dcb6dc4b2b1a4f42f4490e13c45773eb
20718 F20101112_AABUIR malugen_j_Page_087.QC.jpg
49080568e18fab45d9e867131173a318
d98c0f1fd91096ee393ffb0dc2cb2165c6217170
2171 F20101112_AABTGD malugen_j_Page_073.txt
742b199843e2edeaed45c99ab2c9ba26
9e73a0b63781af690c12db72f993128c7679bd97
555 F20101112_AABTFP malugen_j_Page_001.txt
16d8a074acc9c6e7a287622302b378bf
ddc8b1dae8630d5f31133c9f4a54027584158c7e
6418 F20101112_AABUJG malugen_j_Page_096thm.jpg
13ab5655914e8a504d616dfdcc9f4bdc
5dd402fe611f57ee2a907acdd1ce5b5dc04814d8
5920 F20101112_AABUIS malugen_j_Page_087thm.jpg
2c5a2f968a496ad1ef3279ca5448ec52
4b55ab3056d29d3c409630e21de71424cc828af0
F20101112_AABTGE malugen_j_Page_079.txt
c276979cfac95c9ea4da234dd2d2ab2f
3c9da752cdcef04213b2570152510256809089bf
F20101112_AABTFQ malugen_j_Page_028.tif
9f809f3a68d9aaddc593ac5b2664b028
2e133b4b9bb8a737e4d25b24b45268d00a692910
24997 F20101112_AABUJH malugen_j_Page_097.QC.jpg
ceb811f0fce41d2a5bf3c7531dfb00e8
f3ff82a7dc22024a97e251e7d553791f826c88ba
21061 F20101112_AABUIT malugen_j_Page_088.QC.jpg
f3d88ca6518c185b1a690fc6d3267bb0
939ba003a4606037af74d3bc313d8c7cbaa4470e
F20101112_AABTGF malugen_j_Page_106.tif
e8618c8a88da5dd8e0d796938d2f9a18
900f7239fb91ce411c3f799778c8a2fa69b34f8e
F20101112_AABTFR malugen_j_Page_129.tif
6200ee9b22c74ab50012769616ff3905
0981a4d4ef7ce9acbc78c868a0a2835f7c304094
6800 F20101112_AABUJI malugen_j_Page_097thm.jpg
29661e0f22984a1fe30da3bab57018ce
7854a53625d865d5a861278f50d535ca4f8667cc
6336 F20101112_AABUIU malugen_j_Page_088thm.jpg
342b74d85373a9b3dc4aa03ba9b8cb78
c19078e49ed162481e2e57aca6480b4f575f2d66
15280 F20101112_AABTGG malugen_j_Page_108.QC.jpg
41a5249cee6236a536f9e59b2637aba8
cc2a68399c309d64c0ebf4a52b6db0f19983580d
121070 F20101112_AABTFS malugen_j_Page_094.jp2
2eece2ed2e4747206186ab3e1b11bd70
9f536c6c7b5e1ea74d4e34775056537a18c15d3b
4478 F20101112_AABUJJ malugen_j_Page_098thm.jpg
177f1d3eb41c79a516cba442bd602258
950b82580418cd2ee8c4d31610298c5c501a350f
24301 F20101112_AABUIV malugen_j_Page_089.QC.jpg
fff7837ffe12631d1dfb7d32f78eb45d
6d8ba650f7d34d39376d5c7014a1c0c45774455f
84694 F20101112_AABTGH malugen_j_Page_125.jpg
7a5ae6b78f324b939e94adcc35c36ea2
0beb13950209e2e08f0fe4bc5c17280b27af2940
6816 F20101112_AABTFT malugen_j_Page_090thm.jpg
25abf7e9ea1e8f08ae6e668d6d8c92ea
74da61017d99cfd0d8fa138961f3f1cd849c8a34
20482 F20101112_AABUJK malugen_j_Page_099.QC.jpg
2b362f9e78e3b0db6d118f0a2f12f6dd
88940e827c9fbd089eddaf623f1d2472a7c53c20
6794 F20101112_AABUIW malugen_j_Page_089thm.jpg
bd1162bf4f72ee03b3cbb2dfd812b89b
c0fc77d503ea2c82bcd65d5300b452cf86fba689
23592 F20101112_AABTGI malugen_j_Page_096.QC.jpg
736b951886d2c15e462306b25dade31c
121b055a8e75e5c546deb62de70aae158e66a155
4815 F20101112_AABTFU malugen_j_Page_008thm.jpg
355912075ac7cfcbf88bf2bdd8962874
1b2457d0fcc50fd829214f386f3154f7621777e3
5854 F20101112_AABUJL malugen_j_Page_099thm.jpg
cd48b6443ad92177f4d56199c048a929
460bfe580cd3be1d120ba1e0473df0d02d9fb7dc
24084 F20101112_AABUIX malugen_j_Page_090.QC.jpg
b1c543de4a4d91d6de21e6ba82b07ac2
c5b9e817bbb46a18ec69fd5f2f8a2012d132060b
1281 F20101112_AABTGJ malugen_j_Page_103.txt
27146aa025e13b03541d6462329dc2fa
b0563fa47b9f4f5dfaac002d7f53ca72f4014fa6
6712 F20101112_AABTFV malugen_j_Page_086thm.jpg
4287af1b43c647fb1f6d6d77cc68be16
403ae68c3a943d1710caafe6d12fcbefe2a26d6c
4274 F20101112_AABUKA malugen_j_Page_107thm.jpg
805225289c52cfcec0959f72cae1daa5
eb7dd4b85ca590f43598e74a151a20e6d08023c9
21772 F20101112_AABUJM malugen_j_Page_100.QC.jpg
541021ca1c56b948b54418f48599c294
15d26fe9d38d9179971dc8a4fac1b58b0efe1a62
6708 F20101112_AABUIY malugen_j_Page_091.QC.jpg
7a4a0194fbaef5971427c99d87764ad2
d37f173be01c7f21b292797f939b5d83799cf28a
42409 F20101112_AABTGK malugen_j_Page_074.pro
ff337265d54b7ea8442b4063a36c3f97
062998f483479257930589acb503b78d5bf3c0f4
43007 F20101112_AABTFW malugen_j_Page_050.pro
f56a4ffe2ec4062fa5c21154cc539718
b5c406f25f690eaa372a21c272de21fed49501f7
4190 F20101112_AABUKB malugen_j_Page_108thm.jpg
a9e051be9bc18903e91ef895c119957f
cb32b379b2cb59a5915420cd58e319bfcfe506b5
14331 F20101112_AABUJN malugen_j_Page_101.QC.jpg
f243d1e4ce50c19a24e3f564fcf84908
eb8e953889e91e5885ae201cf51179e3ec8a483e
2276 F20101112_AABUIZ malugen_j_Page_091thm.jpg
5cbb41cae37117208c2a615a18c2f5c7
3b7d4e6c254ead6b9de72c877b4ea0d383fb5eda
F20101112_AABTGL malugen_j_Page_107.tif
7e6ce8dda31b66a3d46731a357f5d3a2
53c869752873c57d71749331c5c360e4627e5c67
97628 F20101112_AABTFX malugen_j_Page_069.jp2
28dff51ae3cb5bd8de5b7e619fec654a
842826a051c1306fdeb561667d610ffb8e51da31
14433 F20101112_AABUKC malugen_j_Page_109.QC.jpg
174d54a8f29cde436e9889deeb8c340b
6a36f43035ed777deae7f919e075001b02a08b48
4633 F20101112_AABUJO malugen_j_Page_101thm.jpg
c2d1ff1e6f51e9af48a9dda8f8200394
895e1bc7cce4e1acb5c6d3b6bd243341f1f3c579
F20101112_AABTGM malugen_j_Page_085.tif
0da27a07d75357253372019ba1c1b03a
bc5e854c04d811099f3d8c92b4438bc2e0a39ab4
37739 F20101112_AABTHA malugen_j_Page_054.pro
f20087f6b5b030356c72098b427a27d5
921fad75cc6138f165fef2e52980b977fd8d82c2
4335 F20101112_AABUKD malugen_j_Page_109thm.jpg
2213eabb9905ab7396364fe7aee685b5
f721829c0b33efe2854eb8f6fecf04b6a4cd7150
22062 F20101112_AABUJP malugen_j_Page_102.QC.jpg
c54e94240596c1c3dbc6b84d41f63219
7246bd2c65dad4969ff4dcc9403824942474ad64
18543 F20101112_AABTGN malugen_j_Page_008.QC.jpg
5196bce5b246c1367abcbd8c7112d94e
e73d5019eaf4a50ee7712c870ddee536d29486e7
3586 F20101112_AABTFY malugen_j_Page_005.QC.jpg
a7f6837f675e1536c902198667c5ac9f
c74b021d484925a5c4a68c3c118a6bbce34bf129
58236 F20101112_AABTHB malugen_j_Page_040.jpg
995cf8dd1a5129902b7c3048a14f37dd
81849528f756217793157624086b96f71acc3494
15597 F20101112_AABUKE malugen_j_Page_110.QC.jpg
24ba00c6673a9359844c3af4578c6662
bd5d8c03558d043313d907f150c31c534b04257c
5894 F20101112_AABUJQ malugen_j_Page_102thm.jpg
f3eaf70ef78b16c59f91b8d909d7c70e
4423cfc7098f1200459f06ff6618de4f922a6181
3697 F20101112_AABTFZ malugen_j_Page_120thm.jpg
5dde4e26f92415e5a66285bae9f1ee9e
6653cf02375fb92fe84d993c63adfccfda3eb711
866571 F20101112_AABTHC malugen_j_Page_100.jp2
53c8e18ba37ed85a4b693f5b2677a321
4c265d5d2ffec2a4791efc46bf98d2bbc0d1911c
1993 F20101112_AABTGO malugen_j_Page_088.txt
288150761db5a8fb4246706e13d2109d
6189da67e958cd16f6201ff4de1ac8d91d4b591c
4782 F20101112_AABUKF malugen_j_Page_110thm.jpg
4f71f5458c2e1a2915c876c083ebf61f
ba1d567910a887f490e71bf34677154c5e2aa50a
10907 F20101112_AABUJR malugen_j_Page_103.QC.jpg
ad16944202d484fe88dbfe36e3b9b633
9882980108ac4b46053f592d36ba5bdcdf2b6a70
117488 F20101112_AABTHD malugen_j_Page_023.jp2
2afc7d49e6c98a374859cc66abdae5fd
01f36a23b332a8ee74b9b853e8d4d9302246ca5b
F20101112_AABTGP malugen_j_Page_079.tif
fc2240a19beb133bbda1cffbf1932574
6247cb2c1afba9dd960c1227bc3dcbef7e934b72
16627 F20101112_AABUKG malugen_j_Page_111.QC.jpg
c6916ce0ee798f452cc32345fb10e623
8493a9d069c29170651c4716da21cc9857146dcb
3531 F20101112_AABUJS malugen_j_Page_103thm.jpg
963403f136019ced89d384088863bb66
56f8ea2f855f7c595f8e4158e16e60ee9ed14bff
13585 F20101112_AABTHE malugen_j_Page_010.QC.jpg
84b4c83d2d9ff00be168aa79fabcefd3
ae2a8fff9f60b3f494ecdcee5d68c5f2f77d0778
F20101112_AABTGQ malugen_j_Page_100thm.jpg
b201f11f48dae13c11c33dee4f257124
b61acc3523703984289e4deda6ae52a6e849105e
5289 F20101112_AABUKH malugen_j_Page_111thm.jpg
bd40719e644f2553da77c15609b4a02d
82d5775097c5d12638344ec74a70c9f63d279d21
6308 F20101112_AABUJT malugen_j_Page_104.QC.jpg
5837bbc02422c1c535b31cbe44806c69
0fa98fa328e77307749e7bc8ef5dc3af62b23f4e
2613 F20101112_AABTHF malugen_j_Page_114thm.jpg
99aa830eae370e821b488e5abe1e68d8
67a11a050aa2759b4bec73f8a77032f2b43af095
51776 F20101112_AABTGR malugen_j_Page_038.pro
cbad4842c7c4ee123d3e579585f58654
dba409f2045b24ccf214fa12681618e067443506
21236 F20101112_AABUKI malugen_j_Page_112.QC.jpg
181d96dbef1a9f827db2bd88af14e0d5
fe238ae6ec7bf65ef47f6b99471accf5d03dc216
F20101112_AABUJU malugen_j_Page_104thm.jpg
8bf16e149d7fc4c0558bdada8ec1a8a2
36de4bc1af28f818c4c747aa741cfc24a3c46bdb
108847 F20101112_AABTHG malugen_j_Page_046.jp2
9e532de02b1f0836f61f6109982d5636
ff965078bc2c3f2d540967c7ebaa324d6b8bc760
5080 F20101112_AABTGS malugen_j_Page_054thm.jpg
ce732144a125777ee5a2f5c2dc3b2ae9
0ea0676f3a696a36a1a3d0699f6248459bb07f69
6501 F20101112_AABUKJ malugen_j_Page_112thm.jpg
44592f7f229de7ea23b3a230fbea7a4a
844ecbac00c3882df34a75fe66a846338616d641
14600 F20101112_AABUJV malugen_j_Page_105.QC.jpg
2e4fc4cedb0c8335324ed7896c9511cf
939f0a8c6ff17de482193f025b83b48eddab3fcd
1258 F20101112_AABTHH malugen_j_Page_098.txt
d721d923f5d65a1d09a9acd225500a44
96eb9cae813b17b59f069ea03b455ff3b2f4a841
3351 F20101112_AABTGT malugen_j_Page_122thm.jpg
89f25d411cdf5b755b52d695033b89c3
ef0dd5b16ad63a680d4a7eab7b426115d64b5e9c
10224 F20101112_AABUKK malugen_j_Page_113.QC.jpg
9dddc6a4518fed79e6752b5d4acbfbe4
fe520000bb63bdc96ad88fd313495849ee80373f
4177 F20101112_AABUJW malugen_j_Page_105thm.jpg
1e4003952b912ca370d7383b6d10a3d1
754165bfbd88177fc6808b656ebd7321c1dd499a
2389 F20101112_AABTHI malugen_j_Page_115.txt
0d12997c7d453236f7d85ad6257e050a
1828c13359bda6d0ea8406fdd039f6b89973c04a
35529 F20101112_AABTGU malugen_j_Page_122.jpg
52a6f7eb6247f99c5aaedac26788a857
1767ee3920dc221bfb4fb4f3cd39dfb8eca11347
3089 F20101112_AABUKL malugen_j_Page_113thm.jpg
f46f9a31ae3b2c9662689c6e259080a6
3eff624b6508957bf70969ac841be05075297e06
6479 F20101112_AABUJX malugen_j_Page_106.QC.jpg
5e759cefbba6781e32095b5bc32599ce
0481f5b05f2c649e72e13d5b1fe8cab56b8cc27a
F20101112_AABTHJ malugen_j_Page_020.tif
416c912a6a9a796057b81a063133c81d
a076b146a55f4db461dc6060316ae676624a175c
2630 F20101112_AABTGV malugen_j_Page_105.txt
8663958260ffbcbba1d45723dcf93339
5b8890d6bb759980b7aee31ddc3fcb0e2ad21bd3
25755 F20101112_AABULA malugen_j_Page_125.QC.jpg
499499d117bfc60f6a9c50fbf04cb440
e79b0e626816a7f03eb3857a784d0df8d3679eb3
8217 F20101112_AABUKM malugen_j_Page_114.QC.jpg
61578e29e384defe9b6013c480edb672
6a4d3016e9538a9c32ff0f779639f374e5bfceed
2197 F20101112_AABUJY malugen_j_Page_106thm.jpg
dff04df29515cbdc26ac85de5df9d74f
33a3382a2880d2bdea5ae5d642f63d3e1151b061
F20101112_AABTHK malugen_j_Page_125.tif
072505ebab063ae85afaa829d8c2ad3f
28030fbec43217edd83c969fe445dc9758e37508
24765 F20101112_AABTGW malugen_j_Page_092.QC.jpg
79efdddd22ca56a2999dc6fac72d4a1d
41982ba3b6d8e44ddee1c1d8a1f2e7008e4d57eb
6973 F20101112_AABULB malugen_j_Page_125thm.jpg
d2342def805f565445692737d9a05912
01b4cb745cf289311d71100f7110e402bf1291ec
10003 F20101112_AABUKN malugen_j_Page_115.QC.jpg
066f58c2df5817b9e6890c40ca23e87e
382e127cfd449753d896095f5a1907414b31ceaa
15251 F20101112_AABUJZ malugen_j_Page_107.QC.jpg
2f8123f94d2bb8888e1446d961e33d52
178596315e92d88344dcc191ec1eef3437c342bd
52910 F20101112_AABTHL malugen_j_Page_049.pro
7fa8b63158ba99fdf3db99ca2d2d9ce3
0eb6591bdb6bc444bcee8eff05431e23c5085f45
1016 F20101112_AABTGX malugen_j_Page_010.txt
de379fd45b84ce2c24f61e2484217c4b
445baf99ee8c6ac75bb049c00a0afe07b410d479
23902 F20101112_AABULC malugen_j_Page_126.QC.jpg
26a5acb566feac08f8695565378e64e9
b47d7594576d7bbe553ba5e210ae2ffa25cc9b1c
12031 F20101112_AABUKO malugen_j_Page_116.QC.jpg
7363fff6fc1e08c99d7e61378551fa02
45529e30baefecab59facdd0573347a0cf980019
60874 F20101112_AABTIA malugen_j_Page_075.jpg
341a6729630cbd0eefa8f14f550c757f
f298efae501ac68afbbe937c771909ceaf5e4a38
20492 F20101112_AABTHM malugen_j_Page_050.QC.jpg
1fd8277ce4afffd46b59361361462e49
f6e2beada9a2ac5d905af02500fbefb0d9ba4172
F20101112_AABTGY malugen_j_Page_094.tif
4819fab39e0d79e32ece49ba80d4689a
39e70886dfe259713c7bee539f178face8a43bd7
6847 F20101112_AABULD malugen_j_Page_126thm.jpg
3cd8a40154aafd8b4c91626ab944d471
8833537d0f13bffb0648065a5e3469754d3de850
3809 F20101112_AABUKP malugen_j_Page_116thm.jpg
dbbf5ddf5d3739bc61eee49a03303260
7f0fec1684ced1d2437503f41b8c583f1624c197
23709 F20101112_AABTIB malugen_j_Page_046.QC.jpg
e122651e7d4df93ac8611067ed34ce96
f80678b42ace06d4df3c8aa67221735df300d167
2787 F20101112_AABTHN malugen_j_Page_117.pro
ac7954ed8fab00948d3de2287cbbb734
7b0c7ede3c55fc1df823c7400a2e0cacd39371a2
24446 F20101112_AABULE malugen_j_Page_127.QC.jpg
be92abca96a78c0e7b58122a96bb6629
b6070062dcde7bfa4d2aebe55e6cba23ed95dde2
3963 F20101112_AABUKQ malugen_j_Page_117.QC.jpg
604cab098ea660323264010ab4ba6b52
93ed02357d0fd0c86a45655b93080653dff2e6bf
15026 F20101112_AABTIC malugen_j_Page_003.QC.jpg
8f1b0f8bf8d2bf100f2b33d945527b55
f4b6cb65b80410d0b2761315bff66921b734e183
6423 F20101112_AABTHO malugen_j_Page_060thm.jpg
267ee93717590d3f67affe335a191542
e3e2946209a0450fa796ea4578ff10d8070244a2
25005 F20101112_AABTGZ malugen_j_Page_013.QC.jpg
9ab4542b564760eadf8cb4bfb1c9f2af
d479b77e1c0a4030b0030492935a05c705cc41d1
7344 F20101112_AABULF malugen_j_Page_127thm.jpg
8b182939bfb76a847844b860feeac42a
eb6583e897449740400fed34d4e89e8ab554f3b2
1546 F20101112_AABUKR malugen_j_Page_117thm.jpg
31a9f16acad4acf0692afc548dfd39cb
efbf7875690e1f65075345d72328e1403bf8dc06
2487 F20101112_AABTID malugen_j_Page_001thm.jpg
ad8d974db2bb03277b2ef3e4ecf50349
a16f74437e4a9fc4d16404a71887e893b6efd37f
77426 F20101112_AABTHP malugen_j_Page_051.jpg
edb14a1a1fd1a06cd779e02463f8900e
23eee2148d82829ed34c2a7a8e5509bf908309b3
26506 F20101112_AABULG malugen_j_Page_128.QC.jpg
97c42bc113ae3179805c41310817eae7
2904eac1df5d29050dd54e6cb4dac14c9095b19f
11331 F20101112_AABUKS malugen_j_Page_118.QC.jpg
93cf03aa1af1529058d1649a6d42c413
1ddd7b3d99e18751c474b5af1ac22aa30d9aa895
2076 F20101112_AABTIE malugen_j_Page_038.txt
2b6b960f97e57e538a9c993d9a2f679c
d615faf243f5783779f6a40c08c29ee80135e6bf
1424 F20101112_AABTHQ malugen_j_Page_005thm.jpg
7bcba921d60d3b03809ee34e69dec513
c54b942d1eb75a0db62d53dadbee0b51149d45f8
7414 F20101112_AABULH malugen_j_Page_128thm.jpg
989986d7b98558ae43d5dfb40447ace7
20785aec95e70f843745f5fdcac7b63e207aa89b
3480 F20101112_AABUKT malugen_j_Page_119thm.jpg
972b8989e87a8bc80f09ea258fe13ef0
5574febaa584c128a39ea73a954a48de24004020
51621 F20101112_AABTIF malugen_j_Page_126.pro
22d98eb3c2d2ffefed57aa4f1834549c
8fa840fa1c23c64100b39b8fc0e9ade990c3e655
64598 F20101112_AABTHR malugen_j_Page_088.jpg
c598d417cc976523baa1b6fb37748d88
5530f746918f55cb6dfc81738baa75c2caf0c2c1
15655 F20101112_AABULI malugen_j_Page_129.QC.jpg
8fd5b5b527ee53681ccf66ba29592b8f
4d1608738cd1c0e1e4487de3116094a87c26dc73
10727 F20101112_AABUKU malugen_j_Page_120.QC.jpg
7cc86378286c3792a43f5242f7383e16
e1fe2fb165bdc991e2a5728fa86ec47d55fc4930
74127 F20101112_AABTIG malugen_j_Page_056.jpg
ec40c2550df62f1f25a72961d4f75799
bead3a2e63098ad0b45b159d902ff29e383a37ec
3303 F20101112_AABTHS malugen_j_Page_115thm.jpg
266ab70f6b2e8e63343f8a50604c452d
b621b6b7e6374ddacaf6dce22b0ee7e754cd5b49
4467 F20101112_AABULJ malugen_j_Page_129thm.jpg
dbeef9e42bcea66bacd35814bd234f02
d535b7ae5f6f216dd5b56e57550296f8a086b1f9
5092 F20101112_AABUKV malugen_j_Page_121thm.jpg
68ffe009b9fab614fd1df4d2f5ebc5fd
7db4d646a90ed60cfa64141920e659b8af33d50b
194403 F20101112_AABTIH UFE0020128_00001.xml FULL
9423b03e2e17c8e68022282452bfbb1b
ab0f8e1597e58d66fe2db3156f59e9289e5f97b7
57875 F20101112_AABTHT malugen_j_Page_008.pro
c1ff7489c0ecc19b5dcdcc9bae98efca
bf5fd51ba1d1876c8e4980a70cd0160e4d8e545d
150149 F20101112_AABULK UFE0020128_00001.mets
77f143a26895411323585ce9bba121fd
3b79f7ada2e31684ab3ea4227aa0ae5829f13e65
9755 F20101112_AABUKW malugen_j_Page_123.QC.jpg
f745de2c601d3e84c0076ba8de44212b
abbbced9d778f12d1394c218455c2e16233a5f20
11423 F20101112_AABTHU malugen_j_Page_122.QC.jpg
04fce3b63d39901023c3e04fd014acfc
6afa563538c93d3076528625d4f16686f06a2cc7
3052 F20101112_AABUKX malugen_j_Page_123thm.jpg
80615e98c62904f77c653b59571a2a9c
fc09e93d20c9723dc0750b479a6f0a5ed171587f
24358 F20101112_AABTHV malugen_j_Page_049.QC.jpg
0a984b3874f0c5aa5cbdc45fba7db7ab
50b73aeb9d517a4f54946b8989521b75179bc7a0
26312 F20101112_AABUKY malugen_j_Page_124.QC.jpg
0bf70af8ef2f5baef9c4b3430b992c3c
433dc31f9f2899f8a3a45ab84796d29a17ca1ffc
10141 F20101112_AABTIK malugen_j_Page_002.jpg
66644800f07efab6c21c46f2c7e6beed
400e1b117e17e6cd88b6586d5c5185e3c14b295c
566621 F20101112_AABTHW malugen_j_Page_109.jp2
8ff5d5e935a43f6321d94aee30eb4e7b
25996946e5c71ac1bf2e3e93956e56a0769b6525
7082 F20101112_AABUKZ malugen_j_Page_124thm.jpg
4bba43108d0adcd4bc3e061a6dbfd6ca
d3a4814b6b7db99a29d2e520b1ba16dc70c27689
46427 F20101112_AABTIL malugen_j_Page_003.jpg
81e47ca0ef6fd61d790093fe1aed046a
33ce321fa88edcaf7a0bd58ebef74d2d013b8c3f
F20101112_AABTHX malugen_j_Page_108.tif
754b625ea722929cf7efc8d56561e198
2333acbf050d9dfca5040836bc500f3e8e607108
78386 F20101112_AABTIM malugen_j_Page_004.jpg
253c3b98d8d10ef0dd70663a0e4ea25f
74a91b8318e0c6605bbda018fdb1a867da465b48
11624 F20101112_AABTHY malugen_j_Page_119.QC.jpg
499b517ba434ae126ab1c2359a79f81d
5fc5717a7dfc86a37e40519367910eccefd7c776
73589 F20101112_AABTJA malugen_j_Page_020.jpg
8e3e705dd43f471066852b1aee94022e
92f7ed89e5e029b3ba2a7cc3ec4a7bcfb0e8b3bb
11681 F20101112_AABTIN malugen_j_Page_005.jpg
fe9021448b826b4183e8b6b11fb1d356
15b7e5234146bc841307d88e6baf223f404390ee
F20101112_AABTHZ malugen_j_Page_007.tif
27beadce4fa2861a991c30d0d51ded52
d8723a45e425d93372ff73feafe914d057b94b1d
67509 F20101112_AABTJB malugen_j_Page_021.jpg
bb82b9f7a549157edaf2ab6ec0853b0e
6d4cd5f33d8cd718786763c975ea1f70c89a3ba0
81357 F20101112_AABTIO malugen_j_Page_006.jpg
d7ead388f16fd7545332e571d1e46a9c
627940ef5a5860372a50a714d158265573623f97
78133 F20101112_AABTJC malugen_j_Page_022.jpg
4b41ab6f67bf0ae5a83863b637ae6168
12d9416534d06abca4ccfa6cfff15b6fd7333a34
67686 F20101112_AABTIP malugen_j_Page_007.jpg
f079d9ab09e551de4ddad0b0787b64bf
86825fedb1bdbcd90292d89e8c8e468ab9375c25
77068 F20101112_AABTJD malugen_j_Page_023.jpg
745f8e68376ac3688d72d7362f8f5fbb
9a1909dcaf2b721b99e42b4c002a21e0b7cf5ea4
70691 F20101112_AABTIQ malugen_j_Page_009.jpg
365d2c97048df2a31a1ea9ebfe5dac05
c3eb32dd26d7bdcb433db5e44d3477c4d79f4ef7
77204 F20101112_AABTJE malugen_j_Page_024.jpg
047034b8c513397c6d37d01f83813e2b
3f18ec46221dc8dfa7dcff582fa96235df600026
41055 F20101112_AABTIR malugen_j_Page_010.jpg
e3ddad1b7ad132bfa2cbb88d6317280f
ffa3f87afb976176bcc5ae234a9d114ea03d5de7
78610 F20101112_AABTJF malugen_j_Page_025.jpg
0a9943ec14a4737f369a93594fbefadb
286ca4a5a268d9b02810eb9586b7a99f7efdc526
74199 F20101112_AABTIS malugen_j_Page_011.jpg
6254cc767c65a27077ec70a371473f4c
9390bfcd466c0da2dbbe8c90741e9f99b7326a15
74362 F20101112_AABTJG malugen_j_Page_026.jpg
a24d1e529c149d207d6c79235fde22ab
5dcef01101a9f23e67999848c617affe939305bc
79165 F20101112_AABTIT malugen_j_Page_012.jpg
34625743e96f19e068e5525ef9b58c09
2782e09d2daba913af784d839dd3498b7f48dde2
73561 F20101112_AABTJH malugen_j_Page_027.jpg
59341c8a0d78faa02dec92dc88965d33
d6e1eab5cbeb26c4990cef673c7396918e8b684a
75939 F20101112_AABTIU malugen_j_Page_013.jpg
3fa84379771663e40ba687f4f127c5f0
aa30feccd7934143e485bb6a6c22a6e4aaee871d
74853 F20101112_AABTJI malugen_j_Page_028.jpg
e28f374c643a7fb73f6dabe3cf85b808
809838ae399ba964771a1b047b7b97b1f18ea052
33631 F20101112_AABTIV malugen_j_Page_014.jpg
80885b5cadb813a7e40df2f783cfa230
5a19e960410c89f675c9d65435184e5f5fa4c3a0
65942 F20101112_AABTJJ malugen_j_Page_029.jpg
aa271eb2fd9fa4688379bbd615e7fc83
f0ec48819dd342d4d387ef3db633438c07218263
77966 F20101112_AABTIW malugen_j_Page_015.jpg
d468573eaf1450a487485474e6375ee4
0e2a7b99e32ef9ed37ab0c47616cf6f3eca0c802
77927 F20101112_AABTJK malugen_j_Page_030.jpg
02b01483ee124ba8e88d0db28b788c23
f3f15c9113d9da4a7acf77b655713a7872173591
70416 F20101112_AABTIX malugen_j_Page_016.jpg
e2b00ffbc5c628bc8a31e727934d0dac
96a334e6c243411a6d1967033d1294694c74eb59
81517 F20101112_AABTJL malugen_j_Page_031.jpg
29d74ca5396d00d2dcb38889a17a9bb2
7c348eb3074c10638e161fb5b6c3c75c0af85dc4
79339 F20101112_AABTIY malugen_j_Page_017.jpg
57ed5dccb1d10baf0e6f58173ea03252
e8d3280cfb03be5a099be9ddf0c9104fe0f3aab8
74186 F20101112_AABTKA malugen_j_Page_049.jpg
4c49c33de5385d0a8efcedfc422996fc
861bfd5bea8e98ab00204dd1456113ce0ae6a735
53849 F20101112_AABTJM malugen_j_Page_032.jpg
ba486f28ce2141f62ef66f5b3f330c3b
3a324a3a4eee5442f174ef47a844a3a94e1c3fc7
77493 F20101112_AABTIZ malugen_j_Page_018.jpg
7546de3c128cca73d018bda2d054dd83
660c3d3f6e5b4a3468c43c35568faae472e24320
61936 F20101112_AABTKB malugen_j_Page_050.jpg
0091ea37349938e42f8e366670d1e71c
aaf75e6581d1523bbf19ca122e4a8ade7f5d609a
79349 F20101112_AABTJN malugen_j_Page_033.jpg
ddd32cef7492d03516401eaf37e4b613
eb6ba51dc5d050b26b26c02f6e331d0f0903470c
68267 F20101112_AABTKC malugen_j_Page_052.jpg
3568b1984d2bdd67251b3c1ecaf982c4
0e1d2f043ba11d9316efd6aafd59b5b1c6483703
72905 F20101112_AABTJO malugen_j_Page_034.jpg
862582a1bf891dec0b7dafef04d883b1
41970a7ad5ec5c4804d27856e131395509f0b323
65581 F20101112_AABTKD malugen_j_Page_053.jpg
9a00a05249c6e97e6ea23755b3030f8c
bb10bb1bcd46233d36075cdfba14ee4d9df31ab8
74308 F20101112_AABTJP malugen_j_Page_035.jpg
5399ce9f83a7d12c2590753d57338a31
b7a6677abeb5e9721750ed9448ffa611122c5db7
54299 F20101112_AABTKE malugen_j_Page_054.jpg
9997c289dd76ac817c4fbdffef836ab1
d8790457e449dffc3001c56e304ed7a85384abf2
74378 F20101112_AABTJQ malugen_j_Page_036.jpg
a4b0a869d6fac6f6acbd0009be658ef1
b08620c54cb833cf62375fa8005a9d2eb017db6b
58511 F20101112_AABTKF malugen_j_Page_055.jpg
d22aa51982ad8ed5a6a61cd4b5ddc5c6
4d27745f1a7769ae6a47ee8bebdb56a4f9669c90
72487 F20101112_AABTJR malugen_j_Page_038.jpg
02d8aac6bc78375c80c80900f6615b9b
0c99859b06dc270fba8749ed3003f010caab3fb4
61456 F20101112_AABTKG malugen_j_Page_057.jpg
1cdfa9943d03fe9842112a738170c72d
3605a551a26ea8813ef52ebf0acd5fd248f8b6d4
57968 F20101112_AABTJS malugen_j_Page_039.jpg
ae04f281e49e0bbf8cf29a559cb0d52f
87c0835ef7e7be26af0f6fdb5bb700ee65f49092
56369 F20101112_AABTKH malugen_j_Page_058.jpg
69150d2c400287845724ae1e58147573
0b841825aa56a11f815c3f3025dfbea76f7cdaeb
59079 F20101112_AABTJT malugen_j_Page_041.jpg
b3b0d05553ae9a73cb9dec24eb421ae2
a8aa825f69df433b2723e9a3a4808cde50fb3aba
71294 F20101112_AABTKI malugen_j_Page_060.jpg
e24727f1aad19102dfe86c5aa9ef2f70
8505a0c6730370c6559f23b72c0e7e70667a1217
58725 F20101112_AABTJU malugen_j_Page_042.jpg
8f615346306f5e02210fc692f7111c37
f00fb944db2688ca4b1b9a47492b7b6949d8da12
44476 F20101112_AABTKJ malugen_j_Page_061.jpg
fe96f0d15e9ebfff6c4561f30ba436ff
ed53e9badd623166ccf3d7fb935cb663dd306345
80361 F20101112_AABTJV malugen_j_Page_043.jpg
185e81ab0fc857cdb6bd0367b4e12519
e92d138d414879ec20210fd8aa85fc0de72f0ed1
55020 F20101112_AABTKK malugen_j_Page_062.jpg
a25945aab8a2bfd5cf9944c9c6bc570b
aa066bd304e58fb3fb900f97b189f2e329eab538
73012 F20101112_AABTJW malugen_j_Page_044.jpg
8fff11058e805c4ba5c720aceca44c19
7e77718100a3c37b78fef82efc24b9b848a6303d
73516 F20101112_AABTKL malugen_j_Page_063.jpg
35f75b64aebd2a550cb7fdbda10a34cd
200716c59f5049e4e14ef0823a1c96170eefb4c6
38226 F20101112_AABTJX malugen_j_Page_045.jpg
30ab262c5f99dfec9f1b93d47845fe58
48024d5e321cddc2b9e97497ad948840ad3a9f92
36218 F20101112_AABTLA malugen_j_Page_082.jpg
7710eb890a4ab6f884787ba5dd25c691
96d07981b402d5f571ebb4e148dd9c23c881b36f
62263 F20101112_AABTKM malugen_j_Page_065.jpg
3b656c3cf4dad0c9ef16a69687d3ce16
af8d02549705d8096d06f1c1b8811cd6308c938b
71784 F20101112_AABTJY malugen_j_Page_046.jpg
77112a919dc834531c831cfc13ab8bb1
5850f38004fec19ceac170a6947144fb27eb802f
79765 F20101112_AABTLB malugen_j_Page_083.jpg
83b55fbfa873794f80be62b77476db8c
be8f1000166334fa39401393bdc9d6ebcf80d404
56949 F20101112_AABTKN malugen_j_Page_066.jpg
638b9134cd14e713ad1abbadb1ba9501
0407af22ba3c4dc885ad7c7ff9e6cd534a268034
65796 F20101112_AABTJZ malugen_j_Page_047.jpg
72cf7188da4f73a8c2fc4adab324a4ef
4a385033d00f5fd23631548819c070c61a3c1b67
73395 F20101112_AABTLC malugen_j_Page_084.jpg
d422f3ecb27abe061274e1a3dab1eed4
c3fe2be14c4f6b080b86f63b0b4be27acd21c9ff
69345 F20101112_AABTKO malugen_j_Page_067.jpg
37c91fd6383c2464779e20f8f23f55cc
781ab45ba3198390e56628a152dbf7dbdabcc284
73046 F20101112_AABTLD malugen_j_Page_085.jpg
88e1f91e1aca2a9664dd39bd0bbda272
7bb93cc9a5e4898e9499f7484578677ec6741f3c
64114 F20101112_AABTKP malugen_j_Page_068.jpg
65048d6b1b1d1a646e526485dd4cace2
ae1a8dd8cf750a5ebf63f70762a6a9376bacc66e
75569 F20101112_AABTLE malugen_j_Page_086.jpg
020306f23324c1b858dbd4002a49d4e1
21adcd311b08c4fc363681f8e1d17bd09986cda7
66470 F20101112_AABTKQ malugen_j_Page_069.jpg
b8e3e32b4722c2478bfd35b9711957fd
8c7b8b1f0f8539bc2438f77ce0b197a22809306f
66725 F20101112_AABTLF malugen_j_Page_087.jpg
18aa7f1c77bd184487ec3fa81ccab28d
719d50538bef3ffea27d89544e40d6c64765206d
62794 F20101112_AABTKR malugen_j_Page_070.jpg
851b7f7ebe46d29e48403969c09d0c7c
2bfacc1567ed6cce7e49576ace08f854429fc617
75065 F20101112_AABTLG malugen_j_Page_089.jpg
b95abbc4b6dd943c0e1c4ab4870be96d
759e6e6ab560161363166ee4cbc37b7d235ebc5a
53808 F20101112_AABTKS malugen_j_Page_071.jpg
469653cf2002e8c6c7d3414a10e7b6b6
4307f3dec65dc73ac667aaa58ffe26a47ca838c9
75804 F20101112_AABTLH malugen_j_Page_090.jpg
3bce99ad55b67e6265a43e51905dc317
35d065feca7a615f44b9efa2097c78f10efed26a
73743 F20101112_AABTKT malugen_j_Page_072.jpg
c29c7013ff89338c868ba8268b620d2c
930bbdbc609812a28dd847e773ee93b9707115dc
20192 F20101112_AABTLI malugen_j_Page_091.jpg
d1d0bd47e9b02a3e74f62e68f9ee7a92
a893bce0cc0a767742b1cf7fdb9b1908bec16b53
76298 F20101112_AABTKU malugen_j_Page_073.jpg
e060c6f7dac85372447f543f0b474341
04f5e053fe49cf4429c771a67608be6804d56d60
76282 F20101112_AABTLJ malugen_j_Page_092.jpg
d75aeceaa7aa923304c6f2cf55d34543
00ede9adb69383c49736a3b761b2e6231a99dfdf
62868 F20101112_AABTKV malugen_j_Page_074.jpg
79220e690ed6a2fa9db5460fad64f833
8c44763b980aa860a96ad9bcd35752893214871b
76625 F20101112_AABTLK malugen_j_Page_093.jpg
5efaab376784a3680cadd613d578a57c
9847e891b329171a2318800812b148531221118e
78420 F20101112_AABTKW malugen_j_Page_076.jpg
6b6f35211b2b1134c0119132af6ba393
d5c7dcf8e1f298d8dc4d17ec7fbac5c3fb64890c
65674 F20101112_AABTKX malugen_j_Page_077.jpg
f7142b6511c33b7148e39b2d2fb27ada
09713d6ee938acf93ea9af9aa5a2ffcd6109c3de
79007 F20101112_AABTLL malugen_j_Page_094.jpg
0e5fba5bf47a02df1a4d30a92de509f9
79d539aae1dee72a606657bb60d787bf11a05a4a
62834 F20101112_AABTKY malugen_j_Page_079.jpg
b5e4ed24ac1e27d96532bec47c642244
136587820731f2ca73011521a717f6df54fb8871
27067 F20101112_AABTMA malugen_j_Page_114.jpg
2a38aa08dfb4d587de0e5ab9488397b0
4b55aebb581c1c182e7210c606a74220101e0984
72055 F20101112_AABTLM malugen_j_Page_096.jpg
abdc14641cb6e5cae2ddfb98256bfa72
0638422924711ed74b8a68ba06fe065dc028d923
74597 F20101112_AABTKZ malugen_j_Page_080.jpg
ea17936cc49be7abe64272b0426cae16
41ce0f4248b69b63a9e222a89cdb56d445938721
32831 F20101112_AABTMB malugen_j_Page_115.jpg
4fe49b23ae22778059761640aaf0cc26
a0dd5672c6147efb21496802e05359b768617308
65196 F20101112_AABTLN malugen_j_Page_099.jpg
61082ea3099c03f5bfd31c18dc9b16ef
e86c2ec90fe65f08e698991113cad62b8427ca25
38233 F20101112_AABTMC malugen_j_Page_116.jpg
1a2d62104bfe181dba96ee650c116e8a
0db797fc394f0057183fbe2dc50ff077c765c055
68452 F20101112_AABTLO malugen_j_Page_100.jpg
7cf21ac0fc26422deb5bd4a783db40b5
20e8f8a4c117218f38303ff190c6bf77d6bcea99
13165 F20101112_AABTMD malugen_j_Page_117.jpg
695cf6a6222bedb026ef036c5be80de2
68375288e65a3f18d243a14788c0205fe2f9b38b
45563 F20101112_AABTLP malugen_j_Page_101.jpg
0a8eb55da10645ef89f1958887a735b4
e4235a720d83f0db1b1b7e52619a8f31daea02b3
38173 F20101112_AABTME malugen_j_Page_118.jpg
79383701f2d2fda883caa891837f3f4a
11796b4705b08b1d25f403b2b85892c4f8c4d89e
65799 F20101112_AABTLQ malugen_j_Page_102.jpg
8cc7de0e46f212a234d728fea9ab9817
60b4b6ec0272cffa6c41ef132ba3dc251cd7cbfd
36107 F20101112_AABTMF malugen_j_Page_119.jpg
7d19c2267a48893e8c4d29a58a269649
f0afdccc05f5a32d8beb5fa47929e47550b48c32
35692 F20101112_AABTLR malugen_j_Page_103.jpg
ef9d833bb029e6d3d1497b712b0ede60
4d5dd9b0e6e97961e49cf7ec78c8bd4f8242898a
32747 F20101112_AABTMG malugen_j_Page_120.jpg
36b39afc771711ce7ebf8aaba824893d
a05b49ee29d99efac8bd233e870d621efbf3e98c
49926 F20101112_AABTLS malugen_j_Page_105.jpg
29b1c43f99ba626241f508cb53a9a8ed
ed30cdac9806b7ad972f4ec93e8f9e17e2ea55f5
55024 F20101112_AABTMH malugen_j_Page_121.jpg
c299b6c4b030fe1bd6bbe4e5cf7f8476
4bc27fcabc886a6423e05243d35dd75f87e67ab3
19932 F20101112_AABTLT malugen_j_Page_106.jpg
d342810858b3170f6a421a8bc6074d2e
2f9e65b2a586aa4540c03d79ce21fec132a579de
32691 F20101112_AABTMI malugen_j_Page_123.jpg
751d4bc16080733c890fa0a900aea10e
5a5868dcc1336b436327e27fe92ae28719808800
49088 F20101112_AABTLU malugen_j_Page_107.jpg
fa5c23931395678eaef74e94caefe64d
3e64f9b4cf49a033f02a477a4a56fe9bd56c38f1
90782 F20101112_AABTMJ malugen_j_Page_124.jpg
3aa0473ca4334e83a2d3c45e252f59cd
5d7eea089f6962b881b0826f5238046ae9d603c6
50113 F20101112_AABTLV malugen_j_Page_108.jpg
80cc1e2d7e49a963bbd22d852c930833
35631fcf35f0202b28ee8cde732fe157503dba11
76001 F20101112_AABTMK malugen_j_Page_126.jpg
7cffa63258a5df926b4bbb3a3e443ca5
0eb472b290f1f0a7e561483d3b5e2c7de042ddcf
45173 F20101112_AABTLW malugen_j_Page_109.jpg
3679e5427f486013a1b8bd2aebbcf676
fd11b7f73c5ad2dad0a18ae21d9129d20dad80a1
84798 F20101112_AABTML malugen_j_Page_127.jpg
f5f4357633a5342d2436aea86c02992f
da4a68f15653f5aba678bcc7ad36742b9947e51d
48341 F20101112_AABTLX malugen_j_Page_110.jpg
1d37885360b410411f4a6cd82a0b7691
b444d744a4eb5787912edf1e0161e2e628305256
117880 F20101112_AABTNA malugen_j_Page_015.jp2
0c792c786b72e3279ae78baf3e6b144e
5098c4ee08d4e498447106295221fe2d754c99b3
47420 F20101112_AABTMM malugen_j_Page_129.jpg
c3d683de8964fd498f0ebdd95991315e
e7e4da1197779dcc507aa826e8493d579649b23d
68486 F20101112_AABTLY malugen_j_Page_112.jpg
75455ae37bcbaa18831e7435bf67b9e5
e32d140b660b9767426d2a95f0737b03d279ee7b
103995 F20101112_AABTNB malugen_j_Page_016.jp2
23d0d6a769290d9713b274acd7c4eeff
f5ab244d9229dd84be037dc0686cee63c105137c
29835 F20101112_AABTMN malugen_j_Page_001.jp2
98bfc9de2736b8d9d1b3fa0b7ffcc820
b804dbf1265f38c16ffd8cc1f8a7340456f5f5ac
33018 F20101112_AABTLZ malugen_j_Page_113.jpg
3516c814405040782fecee9747a7ae9c
af9e68cacb0380e9f977e66d6e777bd9f14a197d
118973 F20101112_AABTNC malugen_j_Page_017.jp2
04f5ab7d914e00e1244effa33e43e2cb
1c4aff816d86b7818d59a18672f0c8778bee3606
63728 F20101112_AABTMO malugen_j_Page_003.jp2
439a6cd380fe699d0674885793eabb1f
3efc4ef5e0fb0377bdcaa4f1137a722a8d37a11d
118130 F20101112_AABTND malugen_j_Page_018.jp2
93da5618530c4ca2ea9011c03251cebc
cbd2414e3db85cff09acb1b3a97f87c973549262
1051976 F20101112_AABTMP malugen_j_Page_004.jp2
4946a6fe039fae9697924b4f5115648a
ffc1a8177d3abdc9e104e8c61811a6cc4d658057
132392 F20101112_AABTNE malugen_j_Page_019.jp2
f5f17fed55cc7821e67483f374522b1d
2faf21e14a27fbdf525a25a9a7c9957cdbe1a186
91053 F20101112_AABTMQ malugen_j_Page_005.jp2
0e79fc7883dc2ff5f09e82a027a9238c
7d113eacdbb4b62ebbef1bb089dc7db46c310808
99000 F20101112_AABTNF malugen_j_Page_021.jp2
b14725e5ba2d051b73d46b6ab8138700
583308ab1f2a235c3484142cf0df4ddd35f13bd1
1051984 F20101112_AABTMR malugen_j_Page_006.jp2
bbdecead2bed11474a6699b3b7846c38
9eb903c51112fa3e1766f9ba8d74820becee7f6b
119534 F20101112_AABTNG malugen_j_Page_022.jp2
37fb1813d0e82986795034938aaee7cd
11f44122720da4d468326c1f4e714323d4816fce
1051978 F20101112_AABTMS malugen_j_Page_007.jp2
4a2a94acc7378def685edfb0e3b329e2
81d3518f7f3af8ae1bb9f39449772ab324fdabdf
117429 F20101112_AABTNH malugen_j_Page_024.jp2
7267216226f97b9e4f7f569f330c4ef0
6b1a21267e43594fee3ce24286b1c0bcfdfec17f
1051986 F20101112_AABTMT malugen_j_Page_008.jp2
95308ae0310180f25e61a173683f776f
0b2704824b4997d693f2ca6302a919491e67f1bf
122372 F20101112_AABTNI malugen_j_Page_025.jp2
5ead12728cd5615fd92fd106bf866587
1427783e28dc065ac4387fa7449a4382a465ee7e
102427 F20101112_AABTMU malugen_j_Page_009.jp2
6c8e7ecabcf7a7fede378fc56c3ca10b
abae5ebbe128b359fb83df9d2aa7e4018daac6bd
114817 F20101112_AABTNJ malugen_j_Page_026.jp2
56c0cba08d2d306b7b803374ef7c0dae
a0b6a09e5e604f17f33a749349f1c1b4a520fa59
57820 F20101112_AABTMV malugen_j_Page_010.jp2
724b1261952a66f4616b4e9679a0b4e8
31ebfb04eb1cd557d5aca53690399b6e72e742a9
112879 F20101112_AABTNK malugen_j_Page_027.jp2
21209c3a7ed0367dcde76a9246d0710a
e443a3a8a2502a27c9f907cfffd0408dfabb5d4d
112218 F20101112_AABTMW malugen_j_Page_011.jp2
4fc11bbbd126007eea630acd9c1a7e8b
4b7ed6e95e8aad4147a92a5c55f2806a39cf751e
114289 F20101112_AABTNL malugen_j_Page_028.jp2
6bf1f24255417cd25f6055acdf7d667a
6915d73978f66f2b4c35d238f4c61890e6846a3d
121328 F20101112_AABTMX malugen_j_Page_012.jp2
cf7df5b17a0ce5ec419bb84764ca57ba
b6ba3e492e706e70cfb2875a472ca3caf5b7c866
97295 F20101112_AABTOA malugen_j_Page_047.jp2
6491272acbbc6bf833f4fa19c36bbd60
7b360a2e38061b585ac6e664f10078c295d88ba8
126610 F20101112_AABTNM malugen_j_Page_031.jp2
db6acd9b0e2a6cd6843495f56a76b499
f889e1fc00cec6f9f4a4a6d9dafd9f50d5425724
116044 F20101112_AABTMY malugen_j_Page_013.jp2
687b425a13331dc2e2f4b4fc124bc0ea
2c383f7098bd94940d37f7443d194fc5236df024
79997 F20101112_AABTNN malugen_j_Page_032.jp2
c1bd4d8da792377d05b50216c5a22b86
bbe1093ce1d3359756687a0f71ad717ed2aaa9d0
46839 F20101112_AABTMZ malugen_j_Page_014.jp2
697264aff480109df721f736ed332662
d0dd1d0b7853a499f0066ba15e2d6bc613f35ca0
76683 F20101112_AABTOB malugen_j_Page_048.jp2
8d011952ed7eba46f7f7ec2cb6c2287f
8032808de29165c4072293b51b76dcf28658ee5a
117227 F20101112_AABTNO malugen_j_Page_033.jp2
9e6ed608cfc4b42b12acdcc04846457b
670595b27b1166f3349d19a0de79042d271c73e1
112094 F20101112_AABTOC malugen_j_Page_049.jp2
f42f6879a221e8d23e3d27445dab8542
41d4317c06409f8529c0914caee267edebd64dcd
110749 F20101112_AABTNP malugen_j_Page_034.jp2
be3c33b90c0c118be58dfc7d052b1a72
0c2eccbc0a31a85b41b0472d10b486b1e3928f99
91308 F20101112_AABTOD malugen_j_Page_050.jp2
6a12a7d27af618ba379dbeabc19d379c
f594d50afcd36ebb63049949334ef373dbdd22f0
114668 F20101112_AABTNQ malugen_j_Page_036.jp2
852e9d5f964a747c2691a64c674ba1e3
34952a8e3d612325d3683732a441ca0247928704
1051971 F20101112_AABTOE malugen_j_Page_051.jp2
b8fefd46f0725b4320acdd69f0929369
cb90d2dc7a31aceb7a4dbb78bec71096dbbfa394
109807 F20101112_AABTNR malugen_j_Page_037.jp2
873dd73d584427ff8bfc569ef516e364
8eecd387c75b3750bfd1a7f53b62f98b909d20ad
101622 F20101112_AABTOF malugen_j_Page_052.jp2
053ea3c01e3ec97f19abf4fe40140094
87da3385ad01645e9ea4d30f075d032916d003a6
111670 F20101112_AABTNS malugen_j_Page_038.jp2
4f0060f7a3df3022142de9a725158d8d
b3b7afebc4197b8a401365e5c1826b5ab9171a6c
96163 F20101112_AABTOG malugen_j_Page_053.jp2
859b21c6789a9e4ebde2e5b6c399b31e
f3fbf488f92d5d61ea3991e491a8c538f131db88
86818 F20101112_AABTNT malugen_j_Page_039.jp2
f834aaf5802e7f6cde64c868da46b38e
1a4fb6c38880c4b59d1928b57bfdba733411bccb
79171 F20101112_AABTOH malugen_j_Page_054.jp2
2c9ebfb589af9c9de0d8ac4c709c5bb2
dc24503f79362946c7e9db5a2b487e10706bd2c6
844846 F20101112_AABTNU malugen_j_Page_040.jp2
d2cce06b68d5a74cb6519a30c4184fe1
7bc51c0137d7bd3364e715dd888a66e23910164f
86976 F20101112_AABTOI malugen_j_Page_055.jp2
80324ad8127384bdaa992744f875a4b3
84348b7fe33b413f7d2d6c9e23968434776e2eee
826824 F20101112_AABTNV malugen_j_Page_041.jp2
19fdc236bc57e723e878666fcf437fca
637e8cc3c769334d771c0475d564921c6fd53948
110421 F20101112_AABTOJ malugen_j_Page_056.jp2
22101704f2ddf2a0bb694929b742a4d5
5e7e263c2465ffb3a65eaff7dc6a3fa2331d52e3
811189 F20101112_AABTNW malugen_j_Page_042.jp2
a0e291af8ff61b665bbaddaeff9d5aad
62ed9fc71ed103a60d6f29793a88ca6d16b3dd3a
92750 F20101112_AABTOK malugen_j_Page_057.jp2
f07d365d8782ae344c416913172a75ce
5c75b0000a7d5b9eab039d6c729b505557795593
122569 F20101112_AABTNX malugen_j_Page_043.jp2
3d7494a673ecab3ab567a903b914da76
9d52096ff3aa16080d3a2c95e8bb503eaea8d2d7
93927 F20101112_AABTPA malugen_j_Page_078.jp2
20a73ac1c2f2318d43916c4a7cd1a05b
58a8f8a9bf0b6403308ccee1718f7aea66c8c972
80102 F20101112_AABTOL malugen_j_Page_058.jp2
55f7ae3809e74dafb00e2b924d5cf5f6
965ed70fe0005f57b074b8244dd977adc9b5e7bb
111357 F20101112_AABTNY malugen_j_Page_044.jp2
457ecd588db3972b6bde206ee9334771
dc183d47b51fa444cdf67ff432727ca921a291d9
90415 F20101112_AABTPB malugen_j_Page_079.jp2
de2ce828a7f6ded4ef58f81061b4e89a
4f2f8d962bd2a5e9f1f9a10771555c4af38b6fbb
121305 F20101112_AABTOM malugen_j_Page_059.jp2
5b3807c9e9a7c3cfe5f0dacb6b6e664a
87c297dfa2f5cf64b466c0a25b527d3d1884d737
52214 F20101112_AABTNZ malugen_j_Page_045.jp2
0ab52cec0679b79f5f4a3e1459c6fbed
97ff322c77b4a95cb370478d8f3cd1c759dabbdf
106826 F20101112_AABTON malugen_j_Page_060.jp2
3e3010d1eb1b9c95d8a6a155555c7f5e
0ba3de6ac0639e6eb3aacbcdcadd3f4b0210520c
110848 F20101112_AABTPC malugen_j_Page_080.jp2
976ecf8f6eb331cef2bf6ad2736969b7
73c16325c4a4381bffb4e59828180725eda87693
64007 F20101112_AABTOO malugen_j_Page_061.jp2
0b5001c8de335575ab4fa5cff0ae1406
a388a963cd2f5d96ee89400fdbe2d745aa758d7d
116789 F20101112_AABTPD malugen_j_Page_081.jp2
bc375b96fd470ea5b7bf997798efa34a
b442a64e4a1d90f24634c825011d5f40ad2a2e56
79685 F20101112_AABTOP malugen_j_Page_062.jp2
e613ed24c65bd52073806880a7629054
788742ad6b95a8a7a11757b802443a90cc03f4ad
50149 F20101112_AABTPE malugen_j_Page_082.jp2
5e2957ec36690b39c3f29d7946c6e326
2deb53aeb86cf4089da1c453ecbfcf758791de72
108603 F20101112_AABTOQ malugen_j_Page_063.jp2
dd7fc5e5d6e62b7fed2a0d961c73c81a
7172e4e4e07c1cafe82b8ca1c2337f19f22ccd1e
110784 F20101112_AABTPF malugen_j_Page_083.jp2
c6bbb300bd8c733f68e1cd917e0a4090
416e2e5fddba5725102541533086eac6cf179ba7
93209 F20101112_AABTOR malugen_j_Page_065.jp2
e4659a03a348441cee8f460870300344
627aa6c40c02a5c232624f7500beeb7029ac985c
110690 F20101112_AABTPG malugen_j_Page_084.jp2
200e7a33796cde7f5c8842d168cb994b
d99e59e46af9446b0892a08ac181f236f91977a6
84817 F20101112_AABTOS malugen_j_Page_066.jp2
7d6fcc4ebefabc11cb9b4a8ce7fdec69
b0c1f3c2d7ea32aeb1c4c8c17ed6ea6816f9183b
111432 F20101112_AABTPH malugen_j_Page_085.jp2
68df6cb802206e9c51b6042270e56ebb
5b497a543562ddcfc7e71d885b28fe4cc3cecacd
94105 F20101112_AABTOT malugen_j_Page_068.jp2
0042de47ca14464ab7b5337f9c5b15e8
79b35f756ca9408cb3381b5a3e54fe316df27d6a
93608 F20101112_AABTPI malugen_j_Page_088.jp2
e1aa9e953584d0b54d068d15a4b1d30d
2a760acd4fe39e3b59f95f115ca61c43214901d2
94152 F20101112_AABTOU malugen_j_Page_070.jp2
13b2924681232959e86ceb0dcbb0b02d
2969094d1405f7fdf1e30d8bdba449cb298f19c3
114872 F20101112_AABTPJ malugen_j_Page_089.jp2
96d60047575e96bf3b3fa69d873949d5
771fbad78556c36a9c52a1103c9cf3428ed5af97
111168 F20101112_AABTOV malugen_j_Page_072.jp2
95df4184c65558f384bc4d59af50164a
34565ad67ddad281fe33031f0f062ba047fd810b
113308 F20101112_AABTPK malugen_j_Page_090.jp2
3b94f5ea2e7a589cb4376ad52d914601
5c4eb9d9ae1a4132436d60d1a138a6ad7ca6ab5e
116829 F20101112_AABTOW malugen_j_Page_073.jp2
c9794ae207e8d41bc01553fca49d9c8c
1fd92145b942edcb6ae20b955d117476189eec34
92019 F20101112_AABTQA malugen_j_Page_112.jp2
c832d0092596ba3977afe2a319d06590
047d98d11c2f71e1486efedaa8eb1dcade252a93
23486 F20101112_AABTPL malugen_j_Page_091.jp2
ad06225f459f807bbc0124a862e5fc74
d8eca1070898fe12531e8fac7dcbf69d3644363b
705902 F20101112_AABTOX malugen_j_Page_074.jp2
33e8898dc6f0430f672b0d320143e3a7
687410a7176e2f7900e8a95c274c76fd3dba09cb
67583 F20101112_AABTQB malugen_j_Page_113.jp2
622dc35aa40adb417c42d81d8714b239
575a308c2bf48200cf571aa77a59cef0153caee6
115169 F20101112_AABTPM malugen_j_Page_092.jp2
dafd3084f6b23eb4dfc34f6ffb8fd042
86028adefc8f6784072210f4a9a212c6462420a6
947736 F20101112_AABTOY malugen_j_Page_076.jp2
fffc2658802faadb1cc2551590f503f3
e0fed1fa5083d9636096cb3ab1dcd84fc7d01772
54773 F20101112_AABTQC malugen_j_Page_114.jp2
1ae750a8c2557e8615fb84abc1ef7eab
ea4feb5b5ba7c75519a4396c59d166478f36a180
117848 F20101112_AABTPN malugen_j_Page_093.jp2
2c172c2f47f3df0d25d6f6221083cce0
cd7886ddce35a379f129d64d43e22f61c7a94ad7
906727 F20101112_AABTOZ malugen_j_Page_077.jp2
de87c5fbf70a102408c928cbaed10354
ae9c73c100382d2482464428963ffc6d2394f4c9
118313 F20101112_AABTPO malugen_j_Page_095.jp2
b99d62087accebed610a5b1a24910f0c
9db9f2f96f3068481a49cf4b11cfa5fdd1be6094
69567 F20101112_AABTQD malugen_j_Page_115.jp2
c874632ecbb82773d7a80c5cda31d68f
8a8705c368fbc63957ff5a5d34d9aeea9edbbb70
69373 F20101112_AABTPP malugen_j_Page_098.jp2
9132d2467c5b30b003a20e00e8956659
616714da44ed43581b4ed9afee629de1f4dcd0e5
81474 F20101112_AABTQE malugen_j_Page_116.jp2
16eb8b6c70c17517a501928d5e2a39a2
32ac6f44589dcb7090a9404709626a685508d582
95088 F20101112_AABTPQ malugen_j_Page_099.jp2
d46047741fd5707eacabbd5b19b69fd1
243a950e0d02046f65860f26eda8a079c0975543
10001 F20101112_AABTQF malugen_j_Page_117.jp2
2f7fb744ccbc0444a4ae495229433925
d191722d409222dafb31f852bd77545ecdf828e5
640361 F20101112_AABTPR malugen_j_Page_101.jp2
7b69230a16cdaa55d8876085186652ea
e7656f0101ddc7054615f59dd3272fc65e5fb921
64563 F20101112_AABTQG malugen_j_Page_118.jp2
7d9a90d9ee9e61d34f107649466d9742
b53fc261ae47c28d58de71afca9d15b4caceb61e
98897 F20101112_AABTPS malugen_j_Page_102.jp2
af5bf78310d1e9b8c941162b51c143f8
71d68212b09a4b7f41517a3580937b3071d331fc
69835 F20101112_AABTQH malugen_j_Page_119.jp2
d0fcd7d9382f508b6b98b3c7f591e9cd
2881cf789659e84d661e3e09355bc1a08242ccae
44936 F20101112_AABTPT malugen_j_Page_103.jp2
9542c82668f7707b7a2483e67d015e74
d4b632641131455c91369c4c443cfe869a4011e6
21880 F20101112_AABTPU malugen_j_Page_104.jp2
89cd64a125ea4c2a806cd66c137d1629
53406c2360a519adbffd523d29e854d24a89fe0c
42755 F20101112_AABTQI malugen_j_Page_120.jp2
db67bf9d7e2750dd1d63900c39386a31
495e627feb4adf13120bb589fdfc1a58c10c56a0
97847 F20101112_AABTPV malugen_j_Page_105.jp2
164601c8bbf9a31fc512acd68b956ef0
a8b8d2f2bac098c4a9abb08392b90066d3133e90
71267 F20101112_AABTQJ malugen_j_Page_121.jp2
f3bdf477cbedb533d8afc7a2559c23d3
d85d87f82950773e51be1899df4b2de38c2ad2ed
35289 F20101112_AABTPW malugen_j_Page_106.jp2
fb9a95d9d894465dc592e97677489937
875b8dbb602b142e6b45399e7a43574181f506fb
76510 F20101112_AABTQK malugen_j_Page_122.jp2
86e09384848c9b48bd8f80ac70759a8d
e656cd6225e6e9d67a082890d53f4a0b50870053
108015 F20101112_AABTPX malugen_j_Page_107.jp2
e13d6ddb22b926b534783f8a297af639
935c767390c52f96d51e67e40b75a3ca525f1e9b
F20101112_AABTRA malugen_j_Page_012.tif
102f2cd46b0696a68e24a65703eabe0d
89b328c929cc6a53139c8a4401c5eab798210a4d
77647 F20101112_AABTQL malugen_j_Page_123.jp2
7d5ebdabcd7017b122aa3805f4f5c6d9
485d761b81aa64e26fd724cc0c229ad928b5522d
70166 F20101112_AABTPY malugen_j_Page_110.jp2
af82ebe9075f0750e8326a1a24e879a9
17714e1b35652c6ec63dcb65a9c7dd640f137317
F20101112_AABTRB malugen_j_Page_013.tif
bde7f6786e428c38ca69b87de2c034ab
7361f1946518fc6bc87bce8a6dfc065775ac6001
1051985 F20101112_AABTQM malugen_j_Page_124.jp2
49bc090279ac62254484b23b28bed358
beb59691ab0891301a70feda0593acb74cf02355
73155 F20101112_AABTPZ malugen_j_Page_111.jp2
6e91df2fbcfe98a4490f010bae4f8176
f258cf543bea941b6fe554d5db0413cb352bae59
F20101112_AABTRC malugen_j_Page_014.tif
44c2e875e674fb71a26c51502951b08e
621162b85b26fe5224812ebf1c274fe9cd21ee93
128194 F20101112_AABTQN malugen_j_Page_125.jp2
c265997c140d6df545dea671ea5d0132
30fef56830f3a044ee0980d9a61bc885cf954e84
F20101112_AABTRD malugen_j_Page_015.tif
eab6c88d7718361eaadef97282aa7764
5caac2f6185397b271cfd6209ee14275d57f5484
112386 F20101112_AABTQO malugen_j_Page_126.jp2
cfeffd246a65b71d64a9d60af49e3edb
c719ce5204c9b999d485429d7d5809c33ed2fae1
1051932 F20101112_AABTQP malugen_j_Page_127.jp2
df3de05e33cb43ee6de28679f71448f1
544bde054ee2f6f725805774851cfcee59d273b0
F20101112_AABTRE malugen_j_Page_016.tif
4587e95b80be90bb4d3899220389082b
ca73899bfcd669868db9d8578f522584ff6f0659
1051947 F20101112_AABTQQ malugen_j_Page_128.jp2
eebf225a4718a4211c7ea29c0eb61eee
dfe57994bfaf654dd768a8deae6a8e85f5b58d35
F20101112_AABTRF malugen_j_Page_017.tif
485336a0df6eb7597269e50fb4cb4b25
55748b0bed6abbf022c0afbc7ea4ce4a4c66b726
66189 F20101112_AABTQR malugen_j_Page_129.jp2
8a95a25488908c2aa71b1fcbaa5fdf28
f904c1a53b502cf7a604e54b1f637149c0c54b61
F20101112_AABTRG malugen_j_Page_018.tif
3128cbf7bde0e8ff5dcf9686f2cffee9
dc518e19ccedb0f55946a023904e5cf5cd2a1361
F20101112_AABTQS malugen_j_Page_001.tif
89f67d82a0c7638abf2eb25d4225e6a6
2c5abc5cbda37a80a80ff07c9fe55aaf6f0f7734
F20101112_AABTRH malugen_j_Page_021.tif
84677a6efe13677ef9cfec21c6eea1e4
56533bbf6c3410b35ac40c40ec827a25d77ab4fe
F20101112_AABTQT malugen_j_Page_002.tif
bc7e1a84b836b22ec98f1aae4c475f78
d3703c472fddebe49daef0fcc378f72674bc828a
F20101112_AABTRI malugen_j_Page_022.tif
0b7d179396a407c4392143363546ac2a
1601cadde4ecd8ea836786e427ded30a604daeb0
F20101112_AABTQU malugen_j_Page_003.tif
7f58b566cfdad406d749b0d9f8847303
51c410579a47a21d7fbfa9a7954c20f3a31d49a7
F20101112_AABTRJ malugen_j_Page_023.tif
85bf4f14098140aec824e1d471d65224
e6f3035f9557f732c54aa68c92f2f58c027cad18
F20101112_AABTQV malugen_j_Page_004.tif
3d982b85da2813a57fe05332d2d780a4
7520c63a46b01cfd77cfa6b83b03968467cbd52b
F20101112_AABTRK malugen_j_Page_024.tif
d645160b2d97fbe445676e2cd55818c2
d55e92e280cb1bdae2300a5fe9442425154b1038
F20101112_AABTQW malugen_j_Page_005.tif
30d90873ce109dc464468b130c542858
50a6bd4f87b5690cfaf028f5b701e5d6182f8557
F20101112_AABTSA malugen_j_Page_042.tif
3c05ad1809de60530c837ccef851e810
0401a0c20bd1fefe5020c9fde8e39fde5a6872be
F20101112_AABTRL malugen_j_Page_025.tif
c3290d2ddc4d3d543651763bc86e63d3
cc421decc557815109986aa9742cf61d0115e803
F20101112_AABTQX malugen_j_Page_006.tif
f73c6b5d3ba9c51b965b3a1f33f79000
912592ed415cd9376c8c672fb610ebeb5e7c59bd
F20101112_AABTSB malugen_j_Page_043.tif
813573f695a263961adaf765b9143796
eb3340ed489f3bc6b4ef5292e57172af2202d528
F20101112_AABTRM malugen_j_Page_026.tif
2bd9362677a920529a0329605a00c7cb
216cae64507512a518d0901aa8c953d593cc703a
F20101112_AABTQY malugen_j_Page_008.tif
4e7b0f5316eb68ebc2ff2a425933503f
f3db6ffd5b7b85660de5d9706b2fcc394e17d148
F20101112_AABTSC malugen_j_Page_045.tif
0b77e4214dc5cd95842774c50ed7b020
57b7ace538f92bf06746867c6e4cc954016db224
F20101112_AABTRN malugen_j_Page_027.tif
e73440847f781bfa11879388d5e74db6
1293c1032e519a611ea0c4963e4acfe577087bcb
F20101112_AABTQZ malugen_j_Page_011.tif
2a72a51532302cc94a972dc56f2aaf92
0fb5165ff16fde4b7a6e9c7b6b1eae57865977c7
F20101112_AABTSD malugen_j_Page_046.tif
d9b2c8a8a683f40200ff20479d9adc71
6055a36fc16dfcced13dadb4ed5d573cbde861d1
F20101112_AABTRO malugen_j_Page_029.tif
ce02e248c9af3faa59e7f33957c40501
beb8fcd236a01766ab0ecfba6e6cbe987d5ff1c5
F20101112_AABTSE malugen_j_Page_049.tif
c1366f35bfa1a63985790d9339e8dd0f
2abf5a4ff4d99f02a43e609c8cacddcc7e31a44e
F20101112_AABTRP malugen_j_Page_030.tif
4ddecf777d6e2c501ffb6f1e88cfe0e9
f17afee7b858854b3301ff90e9dbc35f3ff65b1a
F20101112_AABTRQ malugen_j_Page_031.tif
76a25cdef3eda78097e6b6f386edd649
090decfdab18f28f63fca17c29aa59252a7243ec
F20101112_AABTSF malugen_j_Page_050.tif
a417224938bc544c7f18b6e4be42bc31
dbd991ec5f6aefdc46b4c1c5be02e51a4c1acbae
F20101112_AABTRR malugen_j_Page_032.tif
45bb79b745b80ff5b4200322d05c8f62
006ca07bc30b6cf9685c125ee998cdfa55357257
F20101112_AABTSG malugen_j_Page_051.tif
8a3805556ad3ead826b8dc3b20bcac33
95b9275be5a3169a969a8dc3ca4f0dcd1c020170
F20101112_AABTRS malugen_j_Page_033.tif
e738417d0571d17d8b20a3554171b39f
359bfa097be0027e286fef00bf5948a7edf2df17
F20101112_AABTSH malugen_j_Page_052.tif
8388d106191f35b86b68b3e2d64ade07
87f52f2c8f62ca63beba99fc701f7c106ec6fa71
F20101112_AABTRT malugen_j_Page_034.tif
5ab7ec9c98969f313598819194feb1ec
43f36cac014d9de70816f20059682f7a978c60cb
F20101112_AABTSI malugen_j_Page_053.tif
60e17f1b657d20d1b9c94eadc414867f
ca50e376c76d67afa7b4023f412cc2aa23298b5a
F20101112_AABTRU malugen_j_Page_035.tif
f63208fb01203b6ed7370b0a106c7c2a
55dbbb83fa1ef91bd827800d9c3c7caa6dac0dc8
F20101112_AABTSJ malugen_j_Page_054.tif
aab36ecd69c1cca95dcc9b832d7aaf7a
e353659f2b9d8c8a68d339ac0ca22c0c8c252578
F20101112_AABTRV malugen_j_Page_036.tif
152dec568a22a3b173168c096dfbe833
dfcb9252e344b590d0929c1678991d38bb4b34eb
F20101112_AABTSK malugen_j_Page_055.tif
188ff32203173c2cc201169fe04cc79e
89bab4530ec470f851be84507518f4df3ae56a53
F20101112_AABTRW malugen_j_Page_037.tif
30b227bac4df953570fd3372aa84e81e
3689f1a90b301c7bea5c44afc624cf4c11caeb2e
F20101112_AABTSL malugen_j_Page_056.tif
f3cc9d26f7c3268ae6e3d1ff9dc33caa
3625a75c05367e999f21ec98d3ffd76283666b84
F20101112_AABTRX malugen_j_Page_038.tif
1c1f192d49e214d7fb6c29a75390d72b
80572a490e5d868c258a0283a0f448b4912259b4
F20101112_AABTTA malugen_j_Page_072.tif
a134249e6866bc04a6ec7cfc78083eb8
11c0f36e60c155cbda577efb6261c76c6844b01c
F20101112_AABTSM malugen_j_Page_057.tif
3c07f13513ad1a18244b72d04642ccbe
be0c434c1bbd70db99ca214f397e5990a9b6ea03
F20101112_AABTRY malugen_j_Page_039.tif
6be381a46e026bb16c44dd05870f1032
d48a47a2070766c24593da1f130d1494764c5ea3
F20101112_AABTTB malugen_j_Page_074.tif
cfbed5b35de84f200b1676ea5814de36
ba844b645a711f92197e9b3a4e638db80e728861
F20101112_AABTSN malugen_j_Page_058.tif
c29930316625551cebbb78838b6a1aee
38c15d7a1e729ffca7ff3b0000447dd0a25ba0f3
F20101112_AABTRZ malugen_j_Page_040.tif
38b247bbda3ee9a6f2f5fa2ec6c94050
99d256241bc783c766b95b311218dedcfa96de82
F20101112_AABTTC malugen_j_Page_075.tif
accc8af28e6b7b5495294b01cfbcaa27
15224006e8ef808d1a605a4c25fc4404e6c36d15
F20101112_AABTSO malugen_j_Page_059.tif
f724140da509afbc983ea235e89a3733
da84dc52245169a0f005638c83e43d8f3d071a88
F20101112_AABTTD malugen_j_Page_076.tif
702be3c282100e4185f84d0d5581dbc0
14d5ab62ca4a8496a0cfa386d5e1c511a017c92c
F20101112_AABTSP malugen_j_Page_060.tif
88c0fdb3f8d63a8d1b10bc2f9b0f8782
d4165d77176f9c7d15503094895836b90ed6e7fe
8423998 F20101112_AABTTE malugen_j_Page_077.tif
6c7a28bbd7a50a91869547d035d307f1
7d65157945d743aa0883dda4620c14a8047cd989
F20101112_AABTSQ malugen_j_Page_061.tif
d15e560360bbf15e5c9e6e74727a4e0d
abf80449e297188dec494337eaf42bebd94263ba
F20101112_AABTTF malugen_j_Page_078.tif
a8f5b82be1deb5acbdc1236cd55b07b9
78ecce103fa10145dbcfbc29c873c02556cc99f7
F20101112_AABTSR malugen_j_Page_063.tif
2bada6e8a54e6d08a1fe5df2f51ea7f4
eab69a39181be8c4320440474d035d5114219dd9
F20101112_AABTSS malugen_j_Page_064.tif
c1f064d63c8a50bdf9f641d5104ab8b1
17ab583505d6469672795b0fb45dc4247d40bc1d
F20101112_AABTTG malugen_j_Page_080.tif
3c5b24eec2d63625ae3bdfd7626a4264
e6d73a6527912a6b037f06f6f0854b8a596e4b1c
F20101112_AABTST malugen_j_Page_065.tif
82efb3857f7ca99343f1bec399f63ff9
1083371d37713ecb82eb814e6a83d0a941ba5962
F20101112_AABTTH malugen_j_Page_081.tif
e3d731e9d21da2fbe4115ead8652bee1
a76ff013cb47c10a4f9b4d2a38aa2b24de3728f3
F20101112_AABTSU malugen_j_Page_066.tif
1d32c92fb8c526019b62dd117983eef1
22abc35d4a5d0c7a62fe9d83e61c038f05b1ea8a
F20101112_AABTTI malugen_j_Page_082.tif
2267d2262333613f2a9220f16f674973
fb698cd0401314a2bb7cf40d04f3f66e17b18966
F20101112_AABTSV malugen_j_Page_067.tif
564816eb765c8c719aefe5b43223a1a4
4a9fab799b214468c4b11f1dcf08521aa7a604e2
F20101112_AABTTJ malugen_j_Page_083.tif
f0a157bcdb7bf958393902adfdcfc4ce
bb58e8aaa56b5b88006e854cbf34526bdee8c47b
F20101112_AABTSW malugen_j_Page_068.tif
c48830feb0c5612f6e2bccc16fdc33be
c3f21cb1048c935d4ed07f61ed6e071bff90031b
F20101112_AABTTK malugen_j_Page_084.tif
c6781583b5915f146532d69f940d4baf
298bf831a70ae6b4666a6789631a7a770cdaa287
F20101112_AABTSX malugen_j_Page_069.tif
4951f71533d95086598c24a5b67dbaf5
4ff5314ae5c5972d2f590a4b1a194c98fe1cef40
F20101112_AABTUA malugen_j_Page_102.tif
bc4028a1f0c2a0c703060a3afc11e88f
1f735fb6422339bccf9490ae61da9e00a994c2ae
F20101112_AABTTL malugen_j_Page_086.tif
54c890976ac936c965726ac0003664a5
54b27a725dc6868f7d8b93569013233dae053950
F20101112_AABTSY malugen_j_Page_070.tif
be2a2328ba27bbd13e37059d4ff79721
130169de55e69782215bf2a2a526b72f11e85f0e
F20101112_AABTUB malugen_j_Page_103.tif
272b8e0c97430d2d8059a4bbc40abdc9
35635df488b90193b1580b788dce107171319504
F20101112_AABTTM malugen_j_Page_087.tif
3155d910a676141640786ca58f70aa33
8fd10c3f7f625259e86e2e9d4371239ee5f0648a
F20101112_AABTSZ malugen_j_Page_071.tif
a94023cae3cec0acba03538996604afe
7352eac51131ee370be3a91f308bb840196afaf3
F20101112_AABTUC malugen_j_Page_104.tif
3681ba01bd17af44d72e72eb625ce2a5
1ec0af76fb9b864962fc3280c68233b2509e4f4c
F20101112_AABTTN malugen_j_Page_088.tif
5c80cda23c426dc2fe086ef90a4cb139
769c0fdccc19d20711b47399dc03af17cf336bac
F20101112_AABTUD malugen_j_Page_105.tif
e6c50295458b7cec6c1d01dc33883b94
1e844a3a139f955a91fdc7d6c1c2ed35a53d8ded
F20101112_AABTTO malugen_j_Page_089.tif
f66cf2efd84e6884ecf36a10ba6678a9
0532a80f8332c3bdb02435b384d19b42815d7a07
F20101112_AABTUE malugen_j_Page_109.tif
f69a2227dcace6aa9d8a552d462cfe73
c1a9665634c44efb8476800a5ff99fff40007560
F20101112_AABTTP malugen_j_Page_090.tif
63cb26cf921ab6c30a297a4d0ea5f70e
33178a81fc9e222550a31050c2b720eaddbd6be2
F20101112_AABTUF malugen_j_Page_110.tif
5a6857cef3257ca7fe765ec63b456aba
57e2b4f842acc380586092e0ad4b0c0dce6aa2c4
F20101112_AABTTQ malugen_j_Page_091.tif
0f30fe01d045c88714d7cb3f2f55743f
b42ee69d6f478a52d19f02e1f2df93a75332b966
F20101112_AABTUG malugen_j_Page_111.tif
aefaf3cc33a26c535eb34b59dd96c76f
e2dbeb388582303f2e163a275b4311e04de8ed33
F20101112_AABTTR malugen_j_Page_092.tif
21e624e947d46311e2ebb42382217f29
4533dc1be690cbce437c5d2a1de175b8e7b9bd68
2100 F20101112_AABUAA malugen_j_Page_026.txt
b30bd1dc640b4cf2991df473ef4e57e4
9a48ed20b281f99b53db684ac34559d5e2a7934e
F20101112_AABTTS malugen_j_Page_093.tif
b56cc0ee850f255566204c798794525b
84504503270dd339f5b1022c7349d5f67391a47d
2036 F20101112_AABUAB malugen_j_Page_027.txt
9d6fcb49b29720c94a9ad1be13a446e0
6515b95f8d9cfc0c48487607894c2267a3e1e601
F20101112_AABTUH malugen_j_Page_112.tif
1177068197b5210f640c037addcc3f0c
57126e468b0be3f42911c067a1c92b7927962dd2
F20101112_AABTTT malugen_j_Page_095.tif
8f59af7bbc73c5f6123e28a0fc50694b
f6648b778252af78e81a11a58e6a97048cb95093
2097 F20101112_AABUAC malugen_j_Page_028.txt
fcb7164bb443a4ca5deeb646a8a7eb1d
74d6fca43e9448513ab8c539b1d0e746f9d2156a
F20101112_AABTUI malugen_j_Page_114.tif
65f953c796a57fac9911067e8131c97d
a63ab44c0cc3c35d9c9378cb2c020edcdcd4d046
F20101112_AABTTU malugen_j_Page_096.tif
d504fd2f3fcab2a0191fabcd689ff4dd
06e78469dcf0d6e3b374067b497b0b388884d802
2064 F20101112_AABUAD malugen_j_Page_029.txt
a2e11430193b64a93939f28bac483384
2ad7edeb0cbf8e60289591bb2dc2c4002000e86d
F20101112_AABTUJ malugen_j_Page_115.tif
5b3cde73ff5f8582a5a01b4cbdb068f8
daf77e8e87134ee7880359eea940cd2f65df4b77
F20101112_AABTTV malugen_j_Page_097.tif
fb274047b00dae35f2602a5165b955f2
6ee1f837bd6292d1f31da2a533900b2c9484b151
2144 F20101112_AABUAE malugen_j_Page_030.txt
6d7899431a475c9eb21de082762319f1
838b8eacf2f85e15d454ab34a9ec355cd17cd1b5
F20101112_AABTUK malugen_j_Page_116.tif
009b896cc2786124a8533b6bbeed2aa4
1e86cd762dd905da2baaf7054a69e7933c244262
F20101112_AABTTW malugen_j_Page_098.tif
2b7d596796f158501510c228a1875c4c
104a4556d395750b155759f627860e94428eff05
F20101112_AABUAF malugen_j_Page_031.txt
78be995874b75afdce38836410951267
287031dd1f9b3b8d644d1bd4953e35129ddf37eb
73749 F20101112_AABTVA malugen_j_Page_006.pro
62c726ba27eff37a4aceda221564e1ab
e93840675fd0d01184cb0287ba403a96f5003f92
F20101112_AABTUL malugen_j_Page_117.tif
f94e82ebef37d1399938a3eaca654f8a
370722ba5f3c296493504201adb271ff8cbe706a
F20101112_AABTTX malugen_j_Page_099.tif
3fbc72a1f07ffab3be34e058e7f2235a
4e086742cb6f0ce12bc64c6d3dc9c92c1143f143
1429 F20101112_AABUAG malugen_j_Page_032.txt
b716fb9c13b6db32d2561d87fb515a2e
b15dbab22a924ad4d5e95b1cd88554334518ca1e
50731 F20101112_AABTVB malugen_j_Page_007.pro
e7e74aef66c5c805e840a85ff15d6998
3e9eb9f259f51fd6c3b7ac280c40cf2f13847e6b
F20101112_AABTUM malugen_j_Page_118.tif
1632ac23910e78558560ff8ee1025554
99c8af4d96f859f1f0a2f04253b4a6977ba0356d
F20101112_AABTTY malugen_j_Page_100.tif
a4aa98921fb4f99bc11ee458a5e64c0a
443aa11f35e441a35c7faa1ba006a184d3f81cfe
2203 F20101112_AABUAH malugen_j_Page_033.txt
df91a4147510e383deedf23870602592
e52c38d5cfcd2bc17f65f1c3153fe143fdf56b8b
46830 F20101112_AABTVC malugen_j_Page_009.pro
64225b8e635e0e4a8b67c0045e464a68
41f3c1a03967309e31d27ca077b65c9b37352967
F20101112_AABTUN malugen_j_Page_119.tif
48fa26435e657bf14597933978403d3a
b7c277e9eab77a579e5a37e8f5981a9dd7504d28
F20101112_AABTTZ malugen_j_Page_101.tif
9e62fc4ffc802dc3ca5bca5d08f6efe4
007ff9cc4889f7b096b92b27e3bec5e0d0b590e9
2016 F20101112_AABUAI malugen_j_Page_034.txt
d26de5579dd2b98a36603f32aacbb1fa
84d589daa56970bc9aed26cafe7eec6e688fd80f
25476 F20101112_AABTVD malugen_j_Page_010.pro
587aef420105cb834938775d7f18acaf
6874d1b292d16569609f4f3affb309a03ea476d3
F20101112_AABTUO malugen_j_Page_120.tif
be2f7a68d234a6bd758acbfbd92a02f0
333e034682ab7fcf30067bd5b88e64742b01e491
2049 F20101112_AABUAJ malugen_j_Page_035.txt
9a84fadcba7e68bcd03be0ba610171f9
c218034d739897606b93991fca74122e20248964
53348 F20101112_AABTVE malugen_j_Page_011.pro
cbc371630af0a8f429f479d6b92a4d8f
09d2ff57810a8a4c853b88da61e94fef07565d1d
F20101112_AABTUP malugen_j_Page_121.tif
7b175a2ca54d9b865266a4930a9d94e9
863b4dd0d1c6d7b18712ed36b328185b6c678bc7
2061 F20101112_AABUAK malugen_j_Page_036.txt
30bcf9bec0660b845efd84714a513a5b
901f2b2b63fe258cab5f2730d5c928f1d3e9bc4f
55945 F20101112_AABTVF malugen_j_Page_012.pro
5f3e4efe6d54cb897a09b8b17842aa52
98c2fd711dda1a997796bb448067cd075981f560
F20101112_AABTUQ malugen_j_Page_122.tif
610e52c2cb72a8e6c9e8b96cde7b2cc9
6ace0a270539a889881dad537c98a4fa1d410b39
1990 F20101112_AABUAL malugen_j_Page_037.txt
2d5dbc55213578962eeb3bd3909826d7
38f3f00f3ee1eeee86913e00a5ec11c80f43cec1
F20101112_AABTUR malugen_j_Page_123.tif
da6f86b37b78ecb64a9b048ed001b28c
b7c565026122eab5719a258decae107bc5f5a1ed
2102 F20101112_AABUBA malugen_j_Page_056.txt
06184d9ac16206df32f6639283315472
525780ecac641e350d9dd22df16eadf9598da7d5
1547 F20101112_AABUAM malugen_j_Page_039.txt
1868096ec7ca21a53f125c7bac53c142
39a565d5984a5c9bee5651fe74a8f4e8750ac81b
54333 F20101112_AABTVG malugen_j_Page_013.pro
d9d5c1a5ca158ca695fb56fdd09d5ff8
360fee537ecb8ea9ff33bc70a43aecc909610d61
F20101112_AABTUS malugen_j_Page_124.tif
1ffb6bf32f33136fde5eba0c0a6f2fd7
8684bf38087069643db29a2ed879d3e2ce1bf1d5
1972 F20101112_AABUBB malugen_j_Page_057.txt
8cb4a4f019cd01d786ec9e1710216463
9b6fb49900106cc707fea8ab4c1f4fb9680219ba
1743 F20101112_AABUAN malugen_j_Page_040.txt
e8201f4844d33f98e2415fcc550c18ed
170d2aed0085b4d13278c7a9e0c3261661c29898
20219 F20101112_AABTVH malugen_j_Page_014.pro
db61220f223e113df352f14c08818083
4e0f638a4fc7914ee6d59f040bf92ee0b2e5daf2
F20101112_AABTUT malugen_j_Page_126.tif
ee748114515aabc3ed2f67ce72710b0d
7cb97e9c0b5b4ab843799cf96e7acc0b48b6a0e2
1736 F20101112_AABUBC malugen_j_Page_058.txt
695ea2005dfe4f33f55109056a33c050
8fe0d1a787476954bcd5a1502b133bad119e7587
1895 F20101112_AABUAO malugen_j_Page_041.txt
7cca9016d53d40f45499bb0882f157bc
70863ac6cc3c0b429b8a826761e4096a31dffe74
F20101112_AABTUU malugen_j_Page_128.tif
607ae30082837b1a0c31ab83e08f55ea
99270a4917590aee122c7708a58a7956aafd3932
2258 F20101112_AABUBD malugen_j_Page_059.txt
039fe4af659e143962fe25fd84601f90
4806317c10c0a8453363e654b848e9edbfed51c3
1998 F20101112_AABUAP malugen_j_Page_042.txt
84b90bd78976587a08ad3b5c173cd60f
dd5bbe23e157d1546d065d9086dd4953380e3338
54061 F20101112_AABTVI malugen_j_Page_015.pro
ef4dc1acd3d6aee7ccec539042b45eba
3a89bce7ffa300e973d3996f3a44bd2e6959e472
10060 F20101112_AABTUV malugen_j_Page_001.pro
f401cff86bde0884c6816aa2b8ce6a98
b390ee2a1cb6fcdca9a4454e449eccce28334839
2075 F20101112_AABUBE malugen_j_Page_060.txt
e2550701f30be7fe2092ce9bf05b4607
90abfeecd22ccea16a2bc1d3f97d0754c52c74eb
2302 F20101112_AABUAQ malugen_j_Page_043.txt
722e53052742776ab665c114bf913ffc
52015cfaef68c09a3156be4d531f8077798da516
46262 F20101112_AABTVJ malugen_j_Page_016.pro
0bd6be84adc17fa83d140fedcee79da4
e6faae0c170fa7497253040630f81b01391f60a6
1017 F20101112_AABTUW malugen_j_Page_002.pro
a51e0ac5f7c244ef30c4203e8c64ac99
1f8eb249174b0832790a8b85d5bc36930a748a5c
1148 F20101112_AABUBF malugen_j_Page_061.txt
aa1d96b8f7146c8f96021bbe76a63110
ced062dc56117b0b10e21b4d8699da9fae7ee341
1996 F20101112_AABUAR malugen_j_Page_044.txt
42939531c64ba38e89c6bb8eee5339d8
168f324972e8188a9851048a47d1f41a8e3d319b
56204 F20101112_AABTVK malugen_j_Page_017.pro
f0a95e4bd9fad7645af8696309045a11
fceb2707f5892be6aee9042b18d7f926dafb5b5d
28418 F20101112_AABTUX malugen_j_Page_003.pro
66d8f9ff1757e90b4b805c1820ee1473
40df4779206595d7360fe8bc86ac16fef2f72962
1810 F20101112_AABUBG malugen_j_Page_062.txt
a288703da5ccdebe2106fb6e50c01942
91c7cf8e3e4a62a9be2d5067185f9ffbe6ca43a1
53712 F20101112_AABTWA malugen_j_Page_033.pro
c74b0e2353c412b3df86870260d618d3
588b4d303d9e2cc1272e6e186e747893b6a3aefb
55245 F20101112_AABTVL malugen_j_Page_018.pro
8032e5a566df11bffc1794dff17854f9
bad4718a372db4aa09d4038272c8e45ed0fb0abc
72679 F20101112_AABTUY malugen_j_Page_004.pro
8018c7e96a1aae8e0bd9470a61b3f32c
76d1d2f3fd02ce747c80da61411b4a75b99b3935
2428 F20101112_AABUBH malugen_j_Page_063.txt
8ca4a3ad9a954ca9e58290d96f6dfe3f
317e5102ddc8cea7b4a563d1dc4c3900fc8e8154
51056 F20101112_AABTWB malugen_j_Page_034.pro
84c8e547cd63b7bfc8642347e0b3bd02
49519e50b2ea83e7ef2b46db887791e2dc40cb0d
1130 F20101112_AABUAS malugen_j_Page_045.txt
756ad152d2e89b2b3d1b03b2421d7318
8fea9c3f4dff4ef316d7788702fbbf470381f59b
64510 F20101112_AABTVM malugen_j_Page_019.pro
9fa8d2198378f86665e302ec39c5ba7d
edb5afaf5deae74e83eb7d4e1128aa96c38fc0d5
3451 F20101112_AABTUZ malugen_j_Page_005.pro
0d0a739d852ce6dca679870e6ca0756d
e627f091161621429a5316d79d031deb223b2168
1666 F20101112_AABUBI malugen_j_Page_064.txt
bd96362b4221fc83a3248668447f7d2f
8a74b5852e71c8d8abd76c51a2b736089b4d42d0
51885 F20101112_AABTWC malugen_j_Page_035.pro
1ae41ae2bf2d81d80a2be30f1d16c86b
5b9ddf0e52a6dc8196b17668066217aa5182f605
2083 F20101112_AABUAT malugen_j_Page_046.txt
076f367826e3913a54063c4199d9de70
fd04f4f3ad6425711dcfcb9463e9205f0dbb2e30
51599 F20101112_AABTVN malugen_j_Page_020.pro
1b5e5a4a397eeab69ec055acb11c7d6a
dd3f30898873b9727d7acbc64738e8862bd86c8a
2259 F20101112_AABUBJ malugen_j_Page_065.txt
70afdf2df2d4053ae774c700f6c69388
75c907ae6ee2d99736f9e222b1ef1a4999d0ca26
52311 F20101112_AABTWD malugen_j_Page_036.pro
d6a09a0b9da9ab672516b5306d7048c0
a200bd0bb565c7639bbe06cbeaefafd94f554bea
1976 F20101112_AABUAU malugen_j_Page_047.txt
da1290f4fa758e2d56f32d3e355101b9
82f71af32a4f4e2b10478a60a78a5d4f1909579e
48669 F20101112_AABTVO malugen_j_Page_021.pro
d734b157f33a7600173506062ecb59db
e59d89a250c2714fa606ab63a91d23cbf97e7908
2045 F20101112_AABUBK malugen_j_Page_066.txt
350cfa326fec73c9deeabddc13b017d2
4c096c2c95e15f3e101bc021ee4f52d395e0feeb
50375 F20101112_AABTWE malugen_j_Page_037.pro
cab3be978de1b828a270213450be6e04
cca8331557cd4daf7cb62a55e9b1133901e17b25
1653 F20101112_AABUAV malugen_j_Page_048.txt
309ffa8231a81934da19591297488d80
c0fea9f678420870d2de89a7fbd738a35fbd1583
55703 F20101112_AABTVP malugen_j_Page_022.pro
c2f5361e69684d630de3a7037a3a2d61
94ca9bd13081d7db308bd9dd04cb0f4f31900a22
1941 F20101112_AABUBL malugen_j_Page_067.txt
837d20e4f090da4e6c7e936570251083
457b0b2dacb5348983cc657a4cb020a7ea9f93b1
38592 F20101112_AABTWF malugen_j_Page_039.pro
ff867c5f7c15fe82e1772815431ff107
268a6b4feafd149a360117412e0f75b99a65e152
1910 F20101112_AABUAW malugen_j_Page_050.txt
88c6e3f50bd39a866ea52cb718c980bb
50dbe14726263d5c2dee45c59b49414b22f2550f
54494 F20101112_AABTVQ malugen_j_Page_023.pro
420d2bdcb55b602f9f7e77fa1d0fa3f3
959930f8f814acf2ae6a1e3c696eccff2308b7ba
2096 F20101112_AABUCA malugen_j_Page_086.txt
d0b3e16a0dec945bf4f03515a7a5dd0b
57690aebfc66f7ec33a1754d0b16f17a5b2254e5
F20101112_AABUBM malugen_j_Page_068.txt
9b7077a431725348d574f29d423f2ab8
348dd53507835586941b377c2990a679e4b82e74
32364 F20101112_AABTWG malugen_j_Page_040.pro
d561bd12bed737adc0753bc565d45dd1
b6f5cb5d0d871acbb9dcb9259a4e342adfdc7986
1905 F20101112_AABUAX malugen_j_Page_052.txt
5e8674c37c8313f431e4a9c99029f47d
a7a81823106422ddbd50e20398d0c3ebc8a0ceaa
55077 F20101112_AABTVR malugen_j_Page_024.pro
ec9178d0ad3fc124697712400ae51366
0b8041f3a6500d39edf5a4463d6208383f482d69
2356 F20101112_AABUCB malugen_j_Page_087.txt
27086132d4bf4a66e2da2c550b57f894
e81c9049ec39942701c1c07a346bf33ef1b9a044
2254 F20101112_AABUBN malugen_j_Page_069.txt
adf85c7e43af0827f077cde6592e4610
773ab3d9442e8e63fa0438352a9b154f30c54ac6
32871 F20101112_AABTWH malugen_j_Page_041.pro
7bf4565dd71de68aca2b954c713a559a
a8563fe9067c767aee7366d2593ede4fafd9cc21
1581 F20101112_AABUAY malugen_j_Page_054.txt
fff141529675e1f2ac1e0571eb696c9c
0f225f12669d4adbfd5567ed88dd3d31766fdd17
62327 F20101112_AABTVS malugen_j_Page_025.pro
b52489d5e929bdf084788d581945e094
4e078ab16639d9dccd23eb56707212a5f561cd1c
2081 F20101112_AABUCC malugen_j_Page_089.txt
5e512a5442425c5e3e5a6dc5a8e848da
a040a3b1abe6205c769c7e489449f6f260de7641
1505 F20101112_AABUBO malugen_j_Page_071.txt
b7b022a1151f99ad52117a621d1c2d69
6629af2dd8998284cf4a96b58f74e19848485c21
39131 F20101112_AABTWI malugen_j_Page_042.pro
6dfbf2d94447ccdfb38856a2c98f8de2
07d8587509b22e1c32dad9cbe928316438023f2e
1937 F20101112_AABUAZ malugen_j_Page_055.txt
577187e0ca02e4cb643b68fef8db30fd
da6a3c880ff34cf204ca6f2d65287297a2c5e5a5
53322 F20101112_AABTVT malugen_j_Page_026.pro
1b132b82c46899bcb1618ef2bf2952a2
7c0d07220195d1df3f2c15ac2dfd6cc6d9c566eb
2135 F20101112_AABUBP malugen_j_Page_072.txt
b2ea939478690de2d95cc05b3dd59ac1
99112ea3aa89c0041aafc58dd15b203e2e2398fd
51432 F20101112_AABTVU malugen_j_Page_027.pro
95f1d978c0c5644388608beff1537116
90fa0aadaf3d115bbb798ceace66e1c92348ad64
2732 F20101112_AABUCD malugen_j_Page_090.txt
43c3b00ff2240c08288bbf5199c78e84
f692b9c69d8bf526cce6c134b41e34b1e87dc82a
2835 F20101112_AABUBQ malugen_j_Page_074.txt
057a13de926af5d4e39a242cc64a41ca
eec1265d760735a4994b6930ba83ef30db3a49f3
58313 F20101112_AABTWJ malugen_j_Page_043.pro
9c7fff3467064e7b87660b821d8738f9
5805c97326e10f7223f0efbd3e02a79693009af2
53124 F20101112_AABTVV malugen_j_Page_028.pro
6bfc8001635fd1af11b99c28fffed765
c3498aa47dbb604125eba22958e2d6531ac2ebcf
365 F20101112_AABUCE malugen_j_Page_091.txt
baa60f4897c0cf251ca5a97276c2c0aa
2dd896825a49e75e2602c7c4c253bf4e02168591
1647 F20101112_AABUBR malugen_j_Page_075.txt
19735711307f807d8a93697e0e6c0984
d2321e14cad35117556b80275f904657504ace8e
50677 F20101112_AABTWK malugen_j_Page_044.pro
3574ad8b3eb61c359a2d760343520d8f
f9d3680d4586fa81221b69b86d243e4a56fb0566
46437 F20101112_AABTVW malugen_j_Page_029.pro
33b34ed8e23cfec5b78dd75915ff5414
37383ceb2d29bc6ca9dc0a517d0b21f9e8a3a396
2172 F20101112_AABUCF malugen_j_Page_092.txt
e9048e8b09d68290c41a0223d5af7603
31ad7c797de0b0d4a0e1226d4ea2e423d4ad8c62
39773 F20101112_AABTXA malugen_j_Page_066.pro
0e41e31715d49d8d8b78432561f8973d
c286deedc6d317392756105ed4cbc1070e9d5c1d
3707 F20101112_AABUBS malugen_j_Page_076.txt
19861beba323a2fa6eac27cebda8c4ba
714479f3d8bcd87e35ab0c414cb78af9bd1b6d29
26113 F20101112_AABTWL malugen_j_Page_045.pro
380bba17c3f666b08b225bddf768def3
ad53febb16d832d3c159956e2509185f6f8d48cf
54617 F20101112_AABTVX malugen_j_Page_030.pro
248b72323e20d74fe0bc6546ec88abcd
6e72f741d35517f0b0275c7851d5dde1e7bc5faf
2182 F20101112_AABUCG malugen_j_Page_093.txt
fe60dccbd5b0299140588b0cca88b241
f54750553cc48ef0a6fb35ae52031a6b129d6670
48933 F20101112_AABTXB malugen_j_Page_067.pro
eecc583d67ae131939ebc99cf0d8f566
48a5160120fc0bb8ad8d0e1c88942e5006d32843
51469 F20101112_AABTWM malugen_j_Page_046.pro
e65419ba09aae93c94f3684b0081be43
6456d340c39a4bdf4219dea7078421ecc7959975
66302 F20101112_AABTVY malugen_j_Page_031.pro
734d4e42e67a21ab107a788ee23e728c
6967d9910df257435c4234b79cbd9d015846c9c1
2224 F20101112_AABUCH malugen_j_Page_094.txt
e1b7aea70a30f380033b812f39c35e98
b0550b22aa4fa8a00ff76cb7f50d68fdf40e9f63
46662 F20101112_AABTXC malugen_j_Page_068.pro
4853013ff0a83395f690fe424e5d14b0
cf7bc205aeb5963018db3c2c2b31087cb9637722
1688 F20101112_AABUBT malugen_j_Page_077.txt
8b9cc1663ebace33968768a93f35abad
dac0ac22f045446857818b2bbc3b21d39ee24fe3
45576 F20101112_AABTWN malugen_j_Page_047.pro
7d9736c14a2069f2731c0c94b7abf764
65953e54ba2733f08539c33201f75e02f8f303fd
35962 F20101112_AABTVZ malugen_j_Page_032.pro
bace1ad5f0a853e4bcbc66c12453cc24
bb15a6b61f99840af6c31fea585e285c0d4ae51e
2011 F20101112_AABUCI malugen_j_Page_096.txt
fb5986c03fc2865cc174f9b66160cf6e
2f06b620ce6057535fe884657fda17d0853f8cc1
49962 F20101112_AABTXD malugen_j_Page_069.pro
779eb79003f7fb0b27808db94018fb4d
45501a4b376425c2a86f21895a6d0fd87b9d6d1c
1703 F20101112_AABUBU malugen_j_Page_078.txt
1602673567e1f31f9febaa13f3684e46
13e399028b93d9c80d4cbcb3989461b0a901fbce
37856 F20101112_AABTWO malugen_j_Page_048.pro
497c1c030288924f8428c002581024e0
e99cf3238b60475f5ee56845649b0f3e73bf8d05
F20101112_AABUCJ malugen_j_Page_097.txt
a78f2948ae0637b32eb744d30cc74923
eb98f0144111243659b872e2d300e698020c71a5
34936 F20101112_AABTXE malugen_j_Page_071.pro
13358e7bd1f37e0f0757516784833e5b
e701e362093fa308760ff440705b70a5ea3a24ae
2272 F20101112_AABUBV malugen_j_Page_080.txt
ba5973134df91117e43a67191f2d176f
2459a7626b586a1e4e1b97e3b632eff32dbf4595
44630 F20101112_AABTWP malugen_j_Page_051.pro
6891305eff46e1788b032465db5797b8
7531cac50f09a4a2782173979668e4bf1b6cada5
2241 F20101112_AABUCK malugen_j_Page_099.txt
065db53a604231a0a78b20bf6eda0205
ce3aa11629aa3f1fb889bb940be72181998561b1
51710 F20101112_AABTXF malugen_j_Page_072.pro
155908ba088478d484cbee446cc003a8
bf3b785e6d1e7d918aeb7877c8696649a69a315d
2162 F20101112_AABUBW malugen_j_Page_081.txt
56ac9d5e6bb261ef1b82c989be938e6f
8911f484ae90dca787e323750805c5928415f98b
46043 F20101112_AABTWQ malugen_j_Page_053.pro
50443b1ce13f51c74e27859e4828e479
3f87323a43cf743794ca48029fd7acaf2221583a
1110 F20101112_AABUCL malugen_j_Page_100.txt
5da1bb172825bdc18d42ca18fad2535e
8dba7c09403f49e621aee6997541080d7b90d8e4
55208 F20101112_AABTXG malugen_j_Page_073.pro
f2741167f12b1adf98e40464fde91004
71bfcf06808aa48a89b8683707eedb960e1a27b4
889 F20101112_AABUBX malugen_j_Page_082.txt
e3e0db70968b9ef2b0b431a1e6f9f75a
2467d04159475cfc79dd40332524370277670c9c
40617 F20101112_AABTWR malugen_j_Page_055.pro
542309952e933f348c11990170357936
e79181c4dfc6f1adf08d228e45e46b56dbafc25c
978 F20101112_AABUDA malugen_j_Page_120.txt
54209b785d08d5dae62d8b978d663ccf
81c451d862f20b430a6b486d63fdaf641b7a101c
556 F20101112_AABUCM malugen_j_Page_101.txt
ce7b387f2423d9ed43ffb588fec0fae7
5ac0e830450795fc2d8c1b7d5f05cb8589669636
41066 F20101112_AABTXH malugen_j_Page_075.pro
c36a904ee00a8b9e155c96f5b9f70d8a
20784266e6403f532ffe6a5dcf43c341f1ac7746
2870 F20101112_AABUBY malugen_j_Page_083.txt
678291b6669d05c0652b61cec1f3f647
71ac7b7e0132f4acec077390a333f32b2bc13ad4
52648 F20101112_AABTWS malugen_j_Page_056.pro
37c76b594d8b0802e88a3c9903f1d1bc
440cca6249af2bbefeaea5820772b7545c93eda6
2166 F20101112_AABUDB malugen_j_Page_121.txt
31759b7f5ea26f498eea85578d015193
940f13d01ddbb7005844416f73c80210ccb2dc55
1812 F20101112_AABUCN malugen_j_Page_102.txt
3c1bed992c1b2cbc84feb10b9ffebf4d
6ffc6ec070ce4b6197d6f500c29a87028e3e3399
57984 F20101112_AABTXI malugen_j_Page_076.pro
cec05d4dd03301ac26e92a05e2c4ea7a
42cfeed17d727b845857a3820ad2ae0cd42cf5d9
2058 F20101112_AABUBZ malugen_j_Page_084.txt
67c90723bf01ac6833437926c532f108
f2a59e85f26968fb6f3ba4639c4bd753f3fe39b9
47050 F20101112_AABTWT malugen_j_Page_057.pro
74bb5e95acff7a53c688fa29eb675e5f
659264630ea48089c4676aa52f2b82daf016cf60
1985 F20101112_AABUDC malugen_j_Page_122.txt
32f27adab5661ffad209d4d871ae4ef1
5cd09c0b279df18eddd6e35873cd2488dfc3f713
399 F20101112_AABUCO malugen_j_Page_104.txt
57eefae85be3261c00b4563dcf566506
c01f278ee80721b0fa281eaf5de5f777d66ec824
40383 F20101112_AABTXJ malugen_j_Page_077.pro
0fcbb2fc6bc317a5d0d1f7fdce899dda
b42220793083f7c7a3615ec8642543f4be48ac77
39982 F20101112_AABTWU malugen_j_Page_058.pro
d9960ab945f0a7ff90cf843e4ec1534b
13b35fe7b23648671eb7a6b4fbe198df11a2b0cf
F20101112_AABUDD malugen_j_Page_123.txt
74e1d84f6ad0aa1606a51ca4940059f5
09652c4232c592bb93b64f5735b304ef3547142b
1220 F20101112_AABUCP malugen_j_Page_106.txt
fd1f160ef4dae5a256b7bbb8642c802d
5b36f34f8f07df776f1c732e34908bf6c85e0118
57630 F20101112_AABTWV malugen_j_Page_059.pro
a1da19255495781bcf8658979b9006a8
2e42703d3c692a1f469c1713b552e9002126ddd3
F20101112_AABUDE malugen_j_Page_124.txt
beb99ed5baaf844f4a4ec9917c0ebc9e
9951cf6b14b30e13c5e19ea2b8e90d17ee1df30a
3001 F20101112_AABUCQ malugen_j_Page_107.txt
df93b542cf629f0aa2d4d82b903b2a17
5e675728baff70bdebacb7daa465f2615cf2c3f7
42522 F20101112_AABTXK malugen_j_Page_078.pro
10d97c8c4bb49798b746549ff7ae4987
38831f93714b9619169194c283cf388a77d59777
49988 F20101112_AABTWW malugen_j_Page_060.pro
893e1f65e20779df84776d3712153e2e
c8e288229aed12bc293d683401b81462256c6330
2419 F20101112_AABUDF malugen_j_Page_125.txt
86d17e32d82e86d0e167c10776c6b45c
95355dbf5b7cc441068a4f791bfe834091504513
1269 F20101112_AABUCR malugen_j_Page_109.txt
10bdf813b4cfdc3025ea2c304ccc44bc
069664e5d91a78692e4924d23aa2598f8312770b
47680 F20101112_AABTXL malugen_j_Page_079.pro
94b54126c4c449567a8bb1c9651b1eb9
c35739db938c12f89a13ff72162f63567a4f40dd
55789 F20101112_AABTWX malugen_j_Page_063.pro
94c537c079bf108d515bf50cc96b69cf
cc787779a8a8031d077f9fc9de19d8b3993d590e
2110 F20101112_AABUDG malugen_j_Page_126.txt
4b5d962fc8c8c46103474d42d5648fdb
60ea654012849fd2954f4f05ee7a4c4191d91c40
51031 F20101112_AABTYA malugen_j_Page_096.pro
44fd6bc24e44c5a4fb1c92f52f367d54
b70afaeee95d2de96e6bd035f3d4a216e0999644
2250 F20101112_AABUCS malugen_j_Page_110.txt
7d7f8343c686c30730eb60a94e323b1d
a20bff1e55ac811c2920ec7cda95786c9681436c
54192 F20101112_AABTXM malugen_j_Page_080.pro
d9d65aa5866052265f81b709bc588144
8103f704239b3c5652fbc63c5952381e3cfe9043
35772 F20101112_AABTWY malugen_j_Page_064.pro
c3577d81c654833ab0bda9b797377516
41cd88ed3f422d3a17dbceefe1cf20d1dd194a63
F20101112_AABUDH malugen_j_Page_127.txt
3b64824d223411afb1ae262f79fa699f
8f0df6a45fb2549ec991e24a0d77063a9df1f532
54354 F20101112_AABTYB malugen_j_Page_097.pro
59edacc30500b1927ac31a8b5b27287b
aac439ffc712a257e1961686374885c376c4f6cc
2371 F20101112_AABUCT malugen_j_Page_111.txt
3d3e63afe7c0fb630eec8d6fddb50f1e
6e15951c6929c18e00584a71a97cd83376d4a190
22237 F20101112_AABTXN malugen_j_Page_082.pro
14ffe17ee6da36be1e35540281062e61
98a0e64da15598bc268684212aa8d72006cdecb8
45410 F20101112_AABTWZ malugen_j_Page_065.pro
86d7d8990d4f7cb9f8a255ba17cc6e5e
e1387ca1f74197517fed8ce2968010aec943e0d3
2398 F20101112_AABUDI malugen_j_Page_128.txt
dd802d90ae60ab929d74f1cd2f5d4af6
ef273e506ebfe2885443fcb03463de66da052e47
31642 F20101112_AABTYC malugen_j_Page_098.pro
9bf2ef274855f01fa612a966960ee4f9
55a6b21018b6ae94b10e90c65c01cfe91dbc089f
60712 F20101112_AABTXO malugen_j_Page_083.pro
3ae775d6807c645176f06295053bb7bf
69f99ef39b155c656ed62defd29f96d9b2073cd3
1202 F20101112_AABUDJ malugen_j_Page_129.txt
15e8a9a3d3319842d9800ceaab904a67
4b642026b5c43b21c1fbaa73f7b0c972b9f75f41
50132 F20101112_AABTYD malugen_j_Page_099.pro
4b3ffbab047e925b0656b90dac24d6dd
587a749bcb0454558798af256e287ad7913a18bc
2509 F20101112_AABUCU malugen_j_Page_112.txt
b71cab9ac90eaad45326a7f7ca388a4d
1879d63ae23aa7965fa923fdb203903b4051dfa1
52188 F20101112_AABTXP malugen_j_Page_084.pro
b98d44498c0743742feeb17a1f3c658a
20d95b8dcd52922418936af27e0cd2805edbfc3c
8220 F20101112_AABUDK malugen_j_Page_001.QC.jpg
8b32f34920f983de88d748c8b767caee
f8582bbbd7928a39951235e2aa362392294c2b0d
27191 F20101112_AABTYE malugen_j_Page_100.pro
ec126d7ff8f93f31c7ff0db7fcd522d9
45ec8f449b3167eafd4fbcbf9cb776e5b30bdd10
1589 F20101112_AABUCV malugen_j_Page_113.txt
b3448ddf609d7813275f849d757eb597
907bbe93e3a97d62dd3dd73f6f6801d20d70883d
51691 F20101112_AABTXQ malugen_j_Page_085.pro
2d41d96e572f0ee73bbb638198d577e2
9ca8bd8467f6d8eb33c572ea65ffd36f5e13519a
3330 F20101112_AABUDL malugen_j_Page_002.QC.jpg
fef49e6ed3982f20f85e7509a5152dfd
1fef5277e78933afb27a56f070796584b3c51616
10265 F20101112_AABTYF malugen_j_Page_101.pro
1eac3449ccd68016904fda4702c5131d
142e04f5dd3b46ac7c66530c706b58d05080ff61
1249 F20101112_AABUCW malugen_j_Page_114.txt
f6b0e346280318681f4cf6462f6f3bd9
641bd95a9cf7014c3e530c435df05aa605c77ec3
53064 F20101112_AABTXR malugen_j_Page_086.pro
cc34eda5e2745c5c0d132a54c1ede2dd
ea8e83c840beb339727b3c5c4553be222af5f28c
6935 F20101112_AABUEA malugen_j_Page_015thm.jpg
a61c47f208a11a12a33e4669e1afe24e
95bbec068b2d2636d15c26a41783b42eac6e8156
1349 F20101112_AABUDM malugen_j_Page_002thm.jpg
a0194e6f54568c6a84eac0c278fce4ae
3176b30b0d001ae8109ed081fcefaf230a31f485
45330 F20101112_AABTYG malugen_j_Page_102.pro
46762964ce492df9df9abe784f3cf6d7
ce88318ef4725abfe86d596bf9f84bc2f14e5d76
1957 F20101112_AABUCX malugen_j_Page_116.txt
0af3fdab97caa06b71d6967aa45144f8
b10f60b33bc1249ca2f5dfd840ca30dddee04c63
49910 F20101112_AABTXS malugen_j_Page_087.pro
6dcefe4603a058d5a4667bbf8947f5f3
1bd6c5b9943a867ecf4de69b888242e46a5cb7c7
24297 F20101112_AABUEB malugen_j_Page_016.QC.jpg
bb483ca79b1a0341d7c5ad935beb156f
40c7f6a010b6437aed6a8b3d4e090271a41a45d2
4333 F20101112_AABUDN malugen_j_Page_003thm.jpg
4c904484c460268024d9a0236528b36d
81417c78ab272a8317daa81ed2b268819c9d6fe9
23866 F20101112_AABTYH malugen_j_Page_103.pro
9d4a46082e527dc5db3ac61ff26dac5a
57ce230c86edfdbfbc8a82c84fbefb60ec06a7ea
176 F20101112_AABUCY malugen_j_Page_117.txt
fa754f67f35adc62074ac9639c1efa7a
628d0480857a7fe32d4c5676453b41ff104c5ad8
52850 F20101112_AABTXT malugen_j_Page_089.pro
851121b5e551b627c866dc0e1d881481
fd33e6be563e511507fad2d344e43f097f565fa4
6790 F20101112_AABUEC malugen_j_Page_016thm.jpg
113b006e0d4b247cb2975e3c08d128ef
1c64f39ccfbf8193c4a5fd68ff3f21e856a2e04c
22659 F20101112_AABUDO malugen_j_Page_004.QC.jpg
aadb7215560d1a46b36e914ada2c3db0
9a2e5a3f9fc6b9702b0234be6754829536e166ae
8355 F20101112_AABTYI malugen_j_Page_104.pro
fd05cfcfe48c6a0745b7267e92c55d8a
214d3ad05c314e9aa5062b459ccd47741d9e578b
1701 F20101112_AABUCZ malugen_j_Page_119.txt
129aa0e20f6318449de1fd45313753e9
469e2643627ffb3129459bdb9bdde44d63a4bbf8
58888 F20101112_AABTXU malugen_j_Page_090.pro
1ea5dd3963f11a58ab1e51687fde9132
b7e58c25c8c59503d12088e54a0eecfb4e1ccdde
26023 F20101112_AABUED malugen_j_Page_017.QC.jpg
153e1b21eb3e9647b8ed98169c07746a
ce43ca9ab2b283ab38e3da392008f6b5d0343bb0
5930 F20101112_AABUDP malugen_j_Page_004thm.jpg
86d3ee9afca1d1c84ab285686ed2b07c
f97da4be3fc8705738b9dc0df0c09e09bd987c55
60791 F20101112_AABTYJ malugen_j_Page_105.pro
7c2802d6102c64b8635217db8790a55e
d0522e9e81b4b3d56543ce6cdaf9db89bfa6d409
9146 F20101112_AABTXV malugen_j_Page_091.pro
f0b8af9371eff70cf4dbf4fff08269c8
b52ae6f45b4a8cee986e1d50cf6cf7699d51eb11
7072 F20101112_AABUEE malugen_j_Page_017thm.jpg
cf19fd3063d26b74a9059cfcb9e2efe5
856944ce9b76aa1b01e6670e2ebd48202f5e19f9
5992 F20101112_AABUDQ malugen_j_Page_006thm.jpg
57cb8102c15c9c9d02e096eac0a69796
325b5094cccea7163d05223d7fbe26f50f67a496
23788 F20101112_AABTYK malugen_j_Page_106.pro
5608277bf4d6a139ef694a9d0b6b4700
74639a69c4cb9b5419f2a85af453a4f33ba82db2
53616 F20101112_AABTXW malugen_j_Page_092.pro
05d74282ae1358a59bff104765c31212
e3e0107ee06bd16923caf7ae9c5b5d43f504106c
25657 F20101112_AABUEF malugen_j_Page_018.QC.jpg
36b2027fddad0c282582c8af3f834f6e
637d8874fc3f267bc50b3cdced852c71037e3f08
20307 F20101112_AABUDR malugen_j_Page_007.QC.jpg
ea4e93b28b01c39ea675ec4aa3e581f7
ff1b471fa8a5e6cab77d12e55c97e8f40b574dbf
55420 F20101112_AABTXX malugen_j_Page_093.pro
a91bdb7251096c3a9bc077bd4f183242
c9b004113dac308a4d1ce11ffaf6ea422af5eaff
6967 F20101112_AABUEG malugen_j_Page_018thm.jpg
40b30bcb25437c5561a030135b82aebe
ba548ef231e047964d0eb9aa87d2f06d2ab5923d
F20101112_AABTZA malugen_j_Page_124.pro
498eabd63b98db0acf725b72277fe9db
3a5bbf3f6769f01951e84a1db14c2ae8cd23d333
5406 F20101112_AABUDS malugen_j_Page_007thm.jpg
8087d2cc2599bed417d133156bd56575
40b655435987e60fd83a823364a80fa2f7907fa4
69108 F20101112_AABTYL malugen_j_Page_107.pro
6ef5941010503beada7b618608c4291b
37c3de6de0b6d1df402ea8f893347b39025c0213
56665 F20101112_AABTXY malugen_j_Page_094.pro
a977194a429760ea15fe9701972ae08d
c6202f168db2d80b5d88ecf21c0f9d0ad191d42d
7139 F20101112_AABUEH malugen_j_Page_019thm.jpg
5fbf0a7e98d7feea01a3ed1218082676
690f630783e529e02dcc02b0abaa8e9f8863ca22
59728 F20101112_AABTZB malugen_j_Page_125.pro
d99c1ce4aee0829bb67624e47e31d46a
811541cb2a3b662c5a4c9e69dfa7026c39cf2a4b
22017 F20101112_AABUDT malugen_j_Page_009.QC.jpg
2fae7ed60a6a1b2291b21ee12368347a
4cf110f818f69b5418b2a7e9e50bedf6a8b2b02e
74633 F20101112_AABTYM malugen_j_Page_108.pro
342b9bb1b05815aeed2f47f352828d1d
6e26aaa7ebbb7929eda4ebe68340db25b2cc9614
56314 F20101112_AABTXZ malugen_j_Page_095.pro
076c3b23c03afe5f369efaaceebf13c9
5c2666cfab629a48df5c5d8dff428572f7a4a8f4
23303 F20101112_AABUEI malugen_j_Page_020.QC.jpg
f79069251d3cd0d56b04faef401d049e
5ec3fbd6146ca886c892839063bf63977e3c1699
50951 F20101112_AABTZC malugen_j_Page_127.pro
1af355df882dbd1844b7538926fe7aae
fa91c63683bed086af8167693ad12709fdb6ebb8
3968 F20101112_AABUDU malugen_j_Page_010thm.jpg
b5ca9470449ce06b3fcd30eb302bfa47
340e0f52e30701b68c38587156ae361e4305bdb1
26116 F20101112_AABTYN malugen_j_Page_109.pro
b02381c942956e5974102a997993915f
38f13c7505152d976d587688a02ed3ec3ec02a58
6880 F20101112_AABUEJ malugen_j_Page_020thm.jpg
e67c3e311faa78a14a1f107d7bd667c9
b1581f1bb80695915b71bee12f41c32dd2b78005
29302 F20101112_AABTZD malugen_j_Page_129.pro
b73dd734df5de2497daba63641b10744
c7cb815865cb0d8e77db165e87b83402afa0dd58
47384 F20101112_AABTYO malugen_j_Page_110.pro
493eb29da7d93c1f056b8c9bbb0022e9
fa5b2a383a9d2df6c2f052faec17c2901fa67141
21406 F20101112_AABUEK malugen_j_Page_021.QC.jpg
64cb3aa3c1e1dfc9b8462d820c14e094
7e45a9ed2924248ae88a40bc718e5393f93af3b5
97 F20101112_AABTZE malugen_j_Page_002.txt
9daa34a7fc72091151fbdc0c842985f7
0a201c1ef051fabbdb8ae5997040be9b22986f74
24266 F20101112_AABUDV malugen_j_Page_011.QC.jpg
2b2f7ec88eca497e22b727686c977aea
a234a3f0f606a06420e5169d1ae72855d6405589
44601 F20101112_AABTYP malugen_j_Page_111.pro
8c5733fe98718be65115e6f8ecb57639
e9e9aa0bf52dd01706d5ed450067ff441a47c7a8
6030 F20101112_AABUEL malugen_j_Page_021thm.jpg
1384ee3bdc93f7d4080a889e9a0e670a
9cf728c53d6b22e588e57d2ff466ba049428eb37
1169 F20101112_AABTZF malugen_j_Page_003.txt
1e1af2cb02aba3c5524f102e00ca6021
f022b68ba4e2d000eadb7e51229e387df3d8a5c4
6751 F20101112_AABUDW malugen_j_Page_011thm.jpg
7e510f71228b1e3f366f3b725b3325e9
a5d021be6cda36338668dea9ae04b71f8d22477b
54755 F20101112_AABTYQ malugen_j_Page_112.pro
e436a6414330f4e02d6b99c634178dd1
509a0c3d0796efad574f6b93f6b7e1eefb4ae87a
25621 F20101112_AABUEM malugen_j_Page_022.QC.jpg
e0812eb54591523c21fc7b6d5374fa1a
731bb6d709fdd2c4bd124f628e2853107ed99a09
2888 F20101112_AABTZG malugen_j_Page_004.txt
fe6c2f8f51304f423a80c4f266e814b0
ffd2cc28a031b5dd7cfdfd6cd026b365f97dd9c1
6975 F20101112_AABUDX malugen_j_Page_012thm.jpg
9b54a7e93aa0ff4568bdbd93212b1941
3159223bd1bcee94d584ff235f4c1b685d3469ef
37777 F20101112_AABTYR malugen_j_Page_113.pro
f399d64620e1c5f8e83ab539a253679a
adb6fe63d799be9c31198fefd2f2fdd1fba05f6d
25585 F20101112_AABUFA malugen_j_Page_030.QC.jpg
1526982420ec2dd41ef2c66a44cc20fe
7ebe6a5bd391be18b96aadad9adaf359b893ca8b
F20101112_AABUEN malugen_j_Page_022thm.jpg
7d5cf89c2dcc4a6efa323ff70b53af3c
1f523b4c9bae040278912c4d6c8a67e422729647
141 F20101112_AABTZH malugen_j_Page_005.txt
cdd6d8ada3d70a1ed96efaf448a617e0
88bbc7ea2d97366b1dad976bcda6624ed3d46087
6698 F20101112_AABUDY malugen_j_Page_013thm.jpg
8f36dc8a3dc70d9eeb5d6a0c899f7d84
173e52983664e192e60c3a4c7eb375ff9de9165b
28566 F20101112_AABTYS malugen_j_Page_114.pro
31e3fcd960c8b9aa77104634acaca1f0
bdd5fdce6ad1701e54a498a015351a628f90ad1d
7068 F20101112_AABUFB malugen_j_Page_030thm.jpg
adc98590acf66a7ac480fb767ede7af3
c1d916d9dc5f681f06103db2fa71560a246ebaf7
25580 F20101112_AABUEO malugen_j_Page_023.QC.jpg
232bde48763b4b257601ed74b3a385e3
bc97b3c678278044b82993514e57e8208c572836
2948 F20101112_AABTZI malugen_j_Page_006.txt
109ad99408656a60711a31d3bb88b962
86b67cc6d182243afd17531533139a52464fa6ae
25438 F20101112_AABUDZ malugen_j_Page_015.QC.jpg
24b5138f21d1fdf297ec2a4163958f26
2289f8d83d0a88412368ef9dc161dad9efc31033
48086 F20101112_AABTYT malugen_j_Page_115.pro
37646c762d3b7e876a7af0af08a4bfe4
97a3c0d342ba4cb6747cef711c810ab6997cd0b3
25266 F20101112_AABUFC malugen_j_Page_031.QC.jpg
ba12676994a644a6b1ee6d7c669d5612
3c324aace96044883e13dd8cb2d951e9be232018
6907 F20101112_AABUEP malugen_j_Page_023thm.jpg
4ba559b666d5b428f69cf8086ccecb0b
93c317ffdaeca5670146095863df7477e08337b0
1997 F20101112_AABTZJ malugen_j_Page_007.txt
69157ee73679002c819a1896c229825e
1299c4e6c86918752b52f9f3cbc87fee95d1643d
43245 F20101112_AABTYU malugen_j_Page_116.pro
6690b9567e8465ac37704be77b3f1c06
ed17a6a918b9c19ae7969e040c4ebcc733e137af
6806 F20101112_AABUFD malugen_j_Page_031thm.jpg
684a54e06a59c6db9f7f58a98b45787c
1226ccae67037ec34408017ab1a397e55fd78571
25232 F20101112_AABUEQ malugen_j_Page_024.QC.jpg
8d08724ef91824d50cd1dc8aca149a26
cd54865e785dcb4e5728ca84bf171fe26f5a351a
2417 F20101112_AABTZK malugen_j_Page_008.txt
662a002ee8efd3d14bdb57dd3d834f61
e4d1ef3c96253a84a160c7ea29469fc281888173
34626 F20101112_AABTYV malugen_j_Page_119.pro
5beb4a8e09e9a95a22fe5fd44ca5a8e1
c63240568115571a68fc257deea545c56efff0af
17976 F20101112_AABUFE malugen_j_Page_032.QC.jpg
73d6002eaf257acce39ae0cd15aba4c3
7154a1449c014a87adac82cad4519a9dd337c5c2
F20101112_AABUER malugen_j_Page_024thm.jpg
add8b4dc1c06d26928954b05d76f83f8
0d63c1ff501d169505818add93dd2dce8f13c3e7
F20101112_AABTZL malugen_j_Page_009.txt
a569bd55db130e45aa5457a4187b4ad4
5ae34bf62f386282a2da31bda1bc82f199cfa14b
21557 F20101112_AABTYW malugen_j_Page_120.pro
3fbb9e5604a7efdd624a856d1a2733b9
fd5a9912477d726916272b5ab38149d344d818a9
5022 F20101112_AABUFF malugen_j_Page_032thm.jpg
f5587d1877463457ff98fee69b249a2d
d59ade6aabcf6df8a80917c738cc819b25865de2
25187 F20101112_AABUES malugen_j_Page_025.QC.jpg
3d63882f16787ef860db86ceedd12f9f
c8c941bc3687aba849686503595656e5ace49041
44067 F20101112_AABTYX malugen_j_Page_121.pro
56f56d03cbecabcf13e669aaba214530
b9f588490697a6e3bc94d1207ee8b5b5f6ad9eba
25463 F20101112_AABUFG malugen_j_Page_033.QC.jpg
391e9a55ea580b3010673f33cd3e3e32
7f768c846663de6e94e5707e63412d4c855f10d1
6915 F20101112_AABUET malugen_j_Page_025thm.jpg
941cc8571e55081b7e18b32caafdf958
66258254ed036e21a0b9bfde77dd14d3441d2692
2178 F20101112_AABTZM malugen_j_Page_011.txt
b3413feef4674d06579f515fce8235f6
320f0b7d5011febf0261811e85cb3416cb9c669e
41568 F20101112_AABTYY malugen_j_Page_122.pro
b1e381788a62f21b6f1b8c89f068ecc9
8e708cd5045b850cf6577d705a45e03df9a1ca1c
6788 F20101112_AABUFH malugen_j_Page_033thm.jpg
8fce063ceb2f0c5e8e874a4784493096
b442ca9159c42e453eaa40c5c1e835061dee05cb
24905 F20101112_AABUEU malugen_j_Page_026.QC.jpg
157645728bf45f1531af780a291a3c76
d852e8674701a0a64d468d95a8613c6c9b1ca7c3
2195 F20101112_AABTZN malugen_j_Page_012.txt
a6abd6314d5bc7b3d997796af2411ab4
7d1b7fdd7b571128ea8dd2d605fd0ff12f212aca
48168 F20101112_AABTYZ malugen_j_Page_123.pro
f7915ef4fe555d1cf678b8f0862fda52
6a4646b010a75f13d0765f2e94dfe08bd1cfd498
24193 F20101112_AABUFI malugen_j_Page_034.QC.jpg
78deeb1e8d56f2f7b5bf9b2f09394bf7
a9b582b5718b8fac0ab72d0eac4a5bf9b6a6189a
6767 F20101112_AABUEV malugen_j_Page_026thm.jpg
122e7728977eb048b4772d08f71fbe41
09979deaae27a15c0b6bf83516d41f9e1412f770
2134 F20101112_AABTZO malugen_j_Page_013.txt
afde26eedb3704d3c215ba25b7ba2582
beb222330f1cf98ae99df4400ade2699d7b3c26a
6749 F20101112_AABUFJ malugen_j_Page_034thm.jpg
992419b61c4f60079664153194ebe9be
fa954e51ae35dd14f108cb4c32ed19129f6649b4
809 F20101112_AABTZP malugen_j_Page_014.txt
ed2108292230ea875cba859bc12c6828
298e4e92464d4e558f7e674f98cba38bad531d67
23954 F20101112_AABUFK malugen_j_Page_035.QC.jpg
d1bf277a1c7eb93a039a1055113a5d62
7aad0b463a40043e11eb64e95b00e7991742f0f5
23929 F20101112_AABUEW malugen_j_Page_027.QC.jpg
05936af4c641df5989b5d11c3aa08a09
99a2fab034b80e0712605759320f292827b60ce5
2219 F20101112_AABTZQ malugen_j_Page_015.txt
bd0a2f154dd4f9be8db72f126c8a8ce1
7473801bd77cb4b99e7af67b38456f1efc5354c2
6864 F20101112_AABUFL malugen_j_Page_035thm.jpg
c81d46005098fef1a88810863248a376
812575a4e3b35253408ad5c5a5c15cdc99db932a







NEW CHALLENGES TO FLORIDA CITRUS: A CAPITAL BUDGETING ANALYSIS OF
THE IMPACT OF CITRUS CANKER, GREENING, AND RURAL LAND PRICES ON
FLORIDA CITRUS GROWERS


















By

JORDAN CARTER MALUGEN


A THESIS PRESENTED TO THE GRADUATE SCHOOL
OF THE UNIVERSITY OF FLORIDA IN PARITAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF
MASTER OF SCIENCE

UNIVERSITY OF FLORIDA

2009


































2009 Jordan Carter Malugen











ACKNOWLEDGMENTS

First, to my parents, whose insistence that I finish this work on a timely basis was mostly

ignored but not forgotten. Second, to my good friend and intellectual superior Dr. Fredrick

Houts, whose accomplishments serve as an example of diligence for me and all who know him.

Third, to the University of Florida's Food and Resource Economics Department and its Chair,

Dr. Thomas H. Spreen, who recruited me and led me into a new discipline that will serve me for

the rest of my life. Fourth, to Professor Ronald Muraro who taught me the nuts and bolts of the

Florida citrus industry. Fifth, to Dr. Charles Moss who always challenged me to expand my

understanding and perception of the world around me and provided valuable advice on writing

this thesis. Sixth, to the University of Florida's Institute of Food and Agricultural Sciences and

Senior Vice President Jimmy Cheek, who provided me with the financial support and working

environment to complete my work. Lastly, to the people of Florida and the Florida citrus

growers, who made this research possible.









TABLE OF CONTENTS



L IST O F T A B L E S ....................................................................... 6

L IST O F F IG U R E S ........ ............................................................... ................ ........... 8

A B STR A C T ......... .. ............................... ... .......................................................................... 9

C H A P T E R ....................... .......... .................11.........

1 INTRODUCTION ........................................................................... 11

2 ESTABLISHMENT COST, YIELD, AND INVESTMENT PARAMETERS FOR
CITRUS PRODUCTION IN FLORIDA ............................ .................................. ...... 15

M odeling C itrus Production .................................................... .................................. 15
Grove Care and Operating Cost Considerations..................... ..................... 17

3 ACCOUNTING FOR THE EFFECTS OF CITRUS CANKER AND GREENING ON
FLORIDA COMMERCIAL CITRUS PRODUCTION............................ 33

C itru s C ank er ..................................................... 33
C itru s G reen in g ............... ................................................................................ .............. ...... 3 8

4 A NET PRESENT VALUE MODEL OF A FLORIDA CITRUS GROVE ......................... 46

N et Present V alue Theoretical Fram ew ork.................................................. .................... 47
A dapting N PV A analysis to the Citrus G rove............................................... .... .. .............. 63

5 E M P IR IC A L R E SU L T S ............................................................ ..................................... 72

Results of the Mixed-Age Grove Model Yield and Cost Analysis ............... ......... 72
Results of the Mixed-Age Grove Model Breakeven Price Analysis ........................... 81

6 SUMMARY AND CONCLUSIONS .............. ........................................................... 92

APPENDIX ....................................................... 99

A GEOGRAPHIC AND TOPOGRAPHIC FEATURES OF FLORIDA COMMERCIAL
CITRU S PRODUCTION REGION S .............. ........................................................... 99

B PARAMETERS USED IN THE ANALYSIS............................. .............. 104

C SE L E C T E D R E SU L T S ............................ ................. .................................................... 117

L IST O F R E FE R E N C E S ......... ................. .......................................... .................................. 124



4









B IO G R A PH ICA L SK ETCH ........... .......... ....................................................... ........ 129









LIST OF TABLES

Table page

2-1 Florida citrus marketing by variety, 2005-06 season ..................................................... 21

2-2 Spray budget comparison: fresh versus processed, cost per acre......................................... 21

3-1 Tree loss percentages used in analysis .............. ........................................................... 42

3-2 Annual per acre spray costs by disease scenario ........................................................... 45

4-1 D discounting exam ple .................. .................. ................. ............. .............. .. 54

4-2 Risk adjusted discount rates by variety .............. .......................................................... 57

4-3 Discount rates used in citrus investment analysis ........................................ ..... ......... 58

4-4 Built-up capitalization rate method used in analysis ........................................................ 62

4-5 C om parable F lorida grove sales ............................................................................................. 63

5-1 Beginning tree age distribution for mature Valencia on the Ridge .............. .................. 74

5-2 Initial investm ent costs by scenario .............................................................. .................... 79

5-3 Tree loss percentage by scenario ....................................................................... 80

5-4 Estimated breakeven prices across disease scenarios, varieties, and production regions ...... 83

5-5 Grapefruit packout price comparison .......................................................... ............ 87

5-6 H am lin yield-loss sensitivity .................................................... .................................. 88

5-7 Tree loss comparison for a Valencia grove on the Ridge with greening............................. 90

A-2 Average citrus land preparation costs, 2002-03 season....................................................... 103

A-3 Land utilization of Florida citrus groves ............................... 103

B-l Solidset costs by disease scenario for a Valencia orange grove in the ridge....................... 105

B-2 Reset costs by disease scenario for a Valencia located in the ridge .................................... 106

B-3 New planting/replanting operating costs for a Valencia grove (without canker or greening)
............................ ....... .. ................................................ 107

B-4 Operating costs for a mature (15+ year old)Valencia grove located on the ridge (without
canker or greening) .... .............................................. ........ ...... .............. 108









B-5 Harvest and other per box costs ...................................................................... 109

B-6 Adjustment factors for grove care cost by tree age.......... ...................................... 109

B-7 Annual irrigation expense (ridge/flatwoods comparison).............................................. 110

B-8 Average per acre citrus land preparation costs (ridge/flatwoods comparison).................... 110

B-9 Property tax levy for top five citrus producing counties, 2003....... .......................... 110

B -10 Property tax analysis assum options ............................................. ......................... ..... 111

B-11 USDA average yields by variety and production district, 1999-2004 average................ 111

B-12 Rootstock study for Valencia oranges on ridge and flatwoods sites ............................. 112

B-13 Fruit and juice yield by variety used in the analysis................................................ 112

B-14 Mature grove production costs with canker by production region ................................ 113

B-15 Mature grove production costs with greening by production region ............................. 114

B-16 Mature grove production costs with canker and greening ........................................... 115

B-17 Spray schedule and costs by variety and disease scenario............................................. 116

C-l Tree age distribution of a solidset Valencia grove, base scenario................. .............. 118

C-2 Yields for a solidset Valencia grove- base scenario .................................................... 119

C-3 Reset strategy beginning/ending tree distributions under disease scenarios ..................... 120

C-4 Estimated breakeven price by scenario............................... .............. 121

C-5 Average grove production costs by scenario and disease............... ..................... 122









LIST OF FIGURES

Figure page

2-1 Evolution of Florida citrus grove density (source: 2004-05 Florida Citrus Summary)......... 16

2-2 W working capital illustration ............................................................. .............. 29

2-3 Application of working capital to citrus investment ..................................................... 29

3-1 Indonesian citrus production, 1975-2005 ........................................ ................... ..... 40

3-2 T hai citrus production, 1975-2005 ........................................................................................ 4 1

3-3 South A frica citrus production, 1975-2005 ........................................ ................. ...... 42

4-1 R relationship of N PV and IR R ...................................... ............. .......... ............................ 51

4-2 Tree age distribution m atrix ..................................................... ............................ ..... 64

4-3 Cost calculation by tree age (original trees) ........................................ ........ ......... ..... 68

4 -4 R eset tree ag e m atrix ...... ....................... .................................................... ............ .. 6 9

5-1 Costs and yields for a newly planted Valencia grove on the Ridge .................................... 74

5-2 Costs and yields for a mature Valencia grove on the Ridge............................................ 74

5-3 Costs and yields for mature Indian River grapefruit grove with canker ............................ 76

5-4 Costs and yields for mature Hamlin flatwoods grove with greening .................................. 76

5-5 R esettin g com p prison ..................................................... ................................................. 7 7

A-i Florida commercial citrus acreage map, 2005 .............................................................. 100

A -2 Florida citrus soil types.................... .................................. .. ...................... .......... .. 101

A-3 Illustration of flatwoods grove design ................................. 101













8









Abstract of Thesis Presented to the Graduate School
of the University of Florida in Partial Fulfillment
of the Requirements for the Degree of Master of Science

NEW CHALLENGES TO FLORIDA CITRUS: A CAPITAL BUDGETING ANALYSIS
OF THE IMPACT OF CITRUS CANKER, GREENING, AND RURAL LAND PRICES
ON FLORIDA CITRUS GROWERS

By

Jordan Carter Malugen

August 2009

Chair: Thomas H. Spreen
Major: Food and Resource Economics

The Florida citrus industry provides over $9.2 billion dollars in direct and indirect

expenditures; employs more than 75,000 people, mainly in rural areas; and is an emblematic

feature of the landscape and history of Florida. After the disastrous hurricane seasons of 2004

and 2005, Florida citrus acreage is now at its lowest point since the tracking of citrus tree acreage

first began in 1966, and may decline further due to the twin challenges of diseases known as

citrus canker and citrus greening, and the rapid urbanization of the state. This study conducts an

expansive survey of current growing practices and collects available information regarding costs,

returns, and yields to create a detailed set of parameters. These parameters are analyzed to

determine the economics of an investment in citrus within a net present value framework, and

uses scenario analysis to test for effects on the profitability of a citrus investment due to these

new challenges.

Parameters and assumptions are defined to reflect average costs and yields of a Florida

citrus grove in normal operations and under the scenarios of canker, greening, and increased land

prices. An empirical present value model is created which dynamically reflects the changes in

costs, yields, and tree loss and replacement (resetting) through a fifteen-year period. The









analysis examines the citrus investment by looking at: tree yields and costs by variety (Valencia

orange, Hamlin orange, and red grapefruit), age of the grove (new planting versus mature grove),

location (the Central ridge, Southwest Florida flatwoods, and the Indian River regions), the

presence of disease in various severities (canker and greening), and changes in land prices.

The effect of these variables is measured through changes in the breakeven price of one

unit of production (pound solid for oranges or on-tree box for grapefruit). The breakeven price is

defined as the minimum price guaranteeing a positive net present value throughout the fifteen-

year analysis period. Results are presented to help understand how the challenges affecting the

whole industry may affect the investment decisions faced by the thousands of individual

growers, service-providers, and employees who make up this industry and, ultimately, whose

livelihood depends on it.









CHAPTER 1
INTRODUCTION

Florida is the largest producer of citrus in the United States, and second only to Brazil in

the entire world. Florida is the second largest producer of orange juice in the world, and the

largest producer of grapefruit. The 2005-2006 Florida citrus crop was estimated at over $1

billion in value, moreover the Florida citrus industry provided over $9.2 billion dollars in direct

and indirect expenditures to the state GDP and employed more than 75,000 people throughout

the state (Spreen et al. 2006). Unfortunately, while the 2005-6 crop was the second highest

valued crop in Florida history due to high prices, the total acreage of Florida citrus fell 17% from

748,555 to 621,373 acres over the last two years. It is now at its lowest point since the tracking

of citrus tree acreage first began in 1966, and may decline further due to the twin challenges of

diseases known as citrus canker and citrus greening, and the rapid conversion of agricultural land

to residential and commercial uses.

These challenges are unfamiliar to Florida growers and contain the possibility of

fundamentally altering the production and cost structure of the Florida citrus industry. Citrus

canker is a bacterial disease of citrus that causes lesions (or cankers) on the fruit and leaves of

citrus trees, reduces tree productivity, and severely affects the marketability of fresh citrus fruit.

Citrus greening is a bacterial disease of citrus that kills trees and is spread by the invasive insect

species, the Asian citrus psyllid. Finally, rapidly expanding Florida population and conversion

of rural lands to urban use have greatly increased the price of agricultural land suitable for citrus

production and is changing the highest and best use of rural land in many traditional citrus

production areas. It appears that these challenges are having an effect on citrus growers, but

there is a lack of economic analysis focused on the current and projected investment environment

for Florida citrus.









This analysis is a continuation of research conducted for a report prepared for the Florida

Department of Citrus by the Food and Resource Economics Department of the University of

Florida's Institute of Food and Agricultural Sciences (IFAS). The report, An Economic

Assessment of the Future Prospectsfor the Florida Citrus Industry, was an in-depth examination

of the challenges listed above. This study extends the results co-authored with Ronald Muraro of

the University of Florida Lake Alfred Citrus Education and Research Center (Lake Alfred

CREC) and reported in Chapter 5 of the original report summarizing the effects of canker,

greening, and urbanization on a citrus investment. The grove operating costs of the investment

model presented in the study and this analysis are based on annual citrus production cost budgets

assembled by Ronald Muraro from surveys with growers and caretakers around Florida. Yield

information is taken from studies by Drs. William Castle and Fritz Roka, 10 Year Rootstock

Trials at Avon Park and Indiantown (Castle 1994), and High Density Plantings in S,,ilni\I eIt

Florida (Roka et al. 1997) plus Revision to the Rootstock Bulletin (Castle 1999). Information of

grapefruit yields by tree age was obtained from state-wide average production figures from the

Florida Agricultural Statistics Survey's 2005-06 Citrus Summary, as no current studies of

Florida grapefruit yield by tree age exist. A review was conducted of applicable horticultural,

plant pathology, and agricultural engineering literature to create and verify assumptions about

costs, cultivation methods, and the effects of canker and greening on a citrus grove. These

references are cited appropriately where applicable.

This study attempts to fill a gap in the current analysis of the challenges facing the Florida

citrus industry by quantifying current scientific literature on canker and greening with an

economic analysis to illustrate the contemporary investment decision of growers planning on

continuing to operate in the citrus industry over the next 15 years. Given the importance of the









Florida citrus industry in its economic, social, and historic contributions to the state, an analysis

is required that examines the quantitative effects of these challenges on individual growers.

Clues to the observed decline of bearing citrus acreage at the state-wide level can be found at the

level of the individual growers based on the changing economics of growing citrus and investing

in new citrus production in Florida. Since growing citrus is a business activity, this study

presents an analysis of the profitability of an investment in citrus within a capital budgeting

framework.

Prices, yields, costs, and disease effects vary by variety and grove location, so this analysis

creates five hypothetical Florida groves. Grove situations for Valencia and Hamlin sweet

oranges in both the Central Florida Ridge and Southwestern Florida Flatwoods production

regions are considered. Valencia and Hamlin varieties were selected because of their widespread

planting and predominant use for juice processing. A grove situation of colored grapefruit in the

Indian River production region was selected because of the popularity of fresh Indian River

grapefruit. Therefore, this analysis assumes all Valencia and Hamlin oranges will be utilized for

processing and grapefruit is intended for the fresh market.

This study begins with creating parameters and assumptions to reflect average costs and

yields of an operating citrus grove. First, costs and start up considerations are examined for

establishing a citrus grove, including planting density, grove architecture, irrigation, and land

preparation. Second, operating expenses are defined for chemical applications, cultivation,

fertilizer, irrigation, tree removal and replacement, property taxes, operating capital, and

management costs. Third, the analysis examines citrus tree yields by variety and normal tree

loss. Fourth, the analysis quantifies the effects of citrus canker and greening on the grove, and

the additional costs, tree loss, and yield effects these diseases entail.









After the assumptions and parameters of the analysis are defined, an empirical present

value model of the citrus investment is created. The capital budgeting framework is presented

and its application to the citrus grove is explained. Finally, scenarios representing a canker and

greening-free grove, the presence of each canker and greening in the grove, increases in land

prices, and combinations of all three are examined to quantify changes in the returns to a citrus

investment. Results are presented to help understand how the challenges affecting the whole

industry may affect the investment decisions faced by the thousands of individual growers,

service-providers, and employees who make up this industry and, ultimately, whose livelihood

depends on it.









CHAPTER 2
ESTABLISHMENT COST, YIELD, AND INVESTMENT PARAMETERS FOR CITRUS
PRODUCTION IN FLORIDA

An important first step in this analysis is to make accurate assumptions and define

parameters that reflect the reality of an average citrus grower in Florida. While the individual

situation of a grower will vary, the cost and yield assumptions are presented are based on a study

of common practices in the citrus industry. Cost parameters are based on observed prices and

projections on their future levels, while yield parameters are based on referenced studies. First, a

discussion is presented of the factors important in current Florida citrus production and key to

the construction of any analysis model for citrus. Second, research of expected yields by variety

and tree age is presented, and model yields are constructed for our hypothetical groves.

Additional information on considerations for growing citrus in Florida and differences between

the ridge and flatwoods citrus production areas is available in Appendix A: Geographic and

Topographic Features ofFlorida Commercial Citrus Production Areas.

Modeling Citrus Production

Grove Establishment Considerations

Planting a new grove or removing and replacing an existing grove is referred to as a

"solidset". Significant one-time costs are incurred for land preparation and irrigation installation.

The number of citrus trees per acre and the spacing of trees must balance productivity, access,

and the efficient use of the grove area. Tree spacing is defined by in-row and between-row (or

"row middle") spacing. A grove must have enough trees to efficiently utilize soil, light,

fertilizer, and sprays but not so many as to crowd each other out and reduce overall productivity.

Moreover, the grove must have space to allow access for grove equipment and harvesting. Early

citrus plantings in Florida were at large spacings of 25'("in-row") by 25'("between-rows"), or

30' by 30', which gives 70 and 48 trees per acre, respectively. It was even suggested during the









1940s that large grapefruit trees should be spaced 35' by 35' or 36 trees per acre. (Ziegler and

Wolfe 1975) Modem grove care techniques and a better understanding of an efficient bearing

and profit-maximizing grove have pushed tree density much higher over the past two decades.

Current hedging, pruning, fertilization, irrigation, and precision agriculture practices

reduce competition for resources between the trees ("crowding-out") and allow for closer

spacing. Higher density plantings have also been shown to provide an earlier return on

investment and a more efficient use of equipment, materials, and land (Parsons and Wheaton

2006). The trend towards higher density plantings is illustrated in Figure 2-1.


Com m ercial Citrus Trees per Acre

140 -
120 -
Oranges n .---
100:
80 :------ Grapefruit-


1976 1980 1984 1988 1992 1996 2000 2004

Figure 2-1. Evolution of Florida citrus grove density (source: 2004-05 Florida Citrus Summary)

As illustrated in Figure 2-1, the last large increase in tree density occurred during the late

1980s and early 1990s during a period of intensive replanting of a large number of groves

destroyed during the freezes of the 1980s. Currently, there are indications that tree density may

increase again due to the extensive losses of trees under the canker eradication program, new

precision agriculture practices, and mechanical harvesting. Increasing labor costs and

competition from Brazil are making mechanical harvesting of citrus fruit an attractive option for

many growers. Mechanical harvesting of citrus trees requires higher density spacing of 22' X

10' to 24' X 15' for efficient use of the harvesting equipment (Rouse and Futch 2004).









In this analysis, new planting densities are assumed to be 198 trees per acre (22' by 10'

spacing) for Valencia and Hamlin varieties, and 134 trees per acre (22' by 13') for grapefruit.

Mature groves tree densities are taken from the 2003-4 IFAS Citrus Production Budgets as

common densities for existing groves (Muraro 2005 I, II, III). Mature grove densities are

assumed to be 112 trees per acre for Valencia and Hamlin on the Ridge, 145 trees per acre for

Valencia and Hamlin on the Flatwoods, and 95 trees per acre for grapefruit.

In the case of a new or replanting of citrus, this analysis uses an irrigation installation and

setup cost of $1000 per acre for the ridge and flatwoods production areas. New plantings may

require a well to be drilled, which increases the cost of installation, but this is not included in the

analysis. A replanted grove is assumed to incur the same cost for irrigation installation due to

two observed practices (Muraro and Futch 2006). First, the irrigation system is usually damaged

during the process of removing ("pushing") the previous grove. Second, a new system layout is

usually required, especially if there are changes to tree density or other grove architecture.

This analysis does not include the costs of removing or pushing the previous grove, and

starts with the assumption that the land is vacant. Preparing open land for citrus varies

substantially by topographic area (ridge versus flatwoods). Flatwoods groves incur higher land

preparation costs compared to ridge groves. Changes to grove architecture and/or tree density

require incurring costs for soil preparation and bed construction all over again. Therefore, this

analysis assumes that new plantings and replantings of citrus will incur the same land preparation

costs. Average citrus land preparation costs used in this analysis are summarized in Appendix

Table B-10.

Grove Care and Operating Cost Considerations

Citrus fruit is utilized either in the fresh processed market, and in both cases must be

transported from the tree to the juice processing plant or fresh fruit packing house. This process









is currently accomplished in three steps: picking the fruit off the tree, roadsiding it by

transporting it from inside the grove to a central loading point, where the fruit is then hauled to

its final destination. These costs are influenced by wage rates, equipment/materials costs, and

fuel/energy costs. These unit costs are substantial, usually are incurred on a per box basis, and

may exceed grove care costs.

Harvesting costs have remained somewhat stable over the past decade, and this enables the

grower to project how much it will cost with some certainty. Wage rates, fuel/energy costs (until

recently), and equipment/materials costs have remained stable. Unfortunately, there are

uncertainties in the supply of agricultural labor, especially for groves located outside of the

major Florida production areas and for late season varieties such as Valencia oranges. Grapefruit

prices in this analysis are quoted as the industry-standard "on-tree" price meaning the price for

pick, roadside, and haul is already subtracted and they do not include a harvesting charge.

Orange prices are "delivered-in" to the processing plant, and include a per box harvesting charge.

This analysis uses average reported costs from the 2004-05 season of $1.64/box for picking and

roadsiding, and $.47/box for transporting the fruit to the juice processing plant for a total of

$2.11 (Muraro 2006 II). Details of individual per box costs can be found in Appendix Table B7.

Additionally, the Florida Department of Citrus ("DOC") collects a per box excise tax to

fund citrus marketing and industry research. While there have been several legal challenges to

the box tax, plus a current proposal to raise the box tax to $0.25, this analysis assumes a rate of

$0.185 per box, giving a total per box cost of $2.30.

Due to the special handling requirements for fresh fruit, an extra charge of $1.50 per box is

assumed for citrus fruit to be marketed as fresh. Additional handling can include special

packaging and transportation from the grove to ensure the visual appeal of the fruit. Moreover,









spot picking is a common practice in fresh fruit groves, where pickers identify and ensure only

the highest quality fruit is picked and sent for sale as fresh. The assumed pick and haul cost for

fresh market fruit is $3.80 per box.

For most growers, agricultural chemical and application costs are the largest production

cost after harvest costs. The diverse uses of agricultural chemicals in citrus for pest control,

disease control, growth regulation, and nutritional supplementation blur the classifications of

fixed-variable costs and range from certain to uncertain. It is the difficult task of the citrus

grower to balance the health and productivity of his/her trees while minimizing the cost of

materials used. In practice, this is a subjective judgment based on the individual experience of

the grower as illustrated by a 2001 survey of spray practices in the Indian River region.

Research and extension literature on citrus spraying rightly focuses on the
complexity of predicting effects of spray practices on distribution of materials
within trees, even in controlled experiments. Consequently, recommendations from
authorities often provide limited guidance to growers. This forces the industry to
explore spraying as an art, in which changes are attempted on an ad-hoc basis and
either rejected or continued based on individual experience or reports from peers.
The tremendous range of grower spray practices appears to reflect the current status
of this ongoing, largely independent, experimentation by individual growers
(Stover et al. 2002a).

There are significant differences in spray costs for citrus fruit grown to be consumed fresh,

and fruit grown for processing into juice. Fresh market fruit requires a blemish-free peel to

enhance its marketability and visual appeal to the consumer. Fresh fruit is delivered to a

packinghouse where it is sorted according to size and peel blemishes. The fruit judged unfit for

fresh consumption is "eliminated" from the total amount delivered, and sent for processing into

juice. The percentage of the total fruit delivered to the packinghouse that is fit for fresh market

sale is called the "packout" rate. Often a fresh fruit packinghouse will deduct a fee for the

eliminated fruit that passes through its packing line and is transported to a juice processing

facility. This fee is deducted (or "charged") from the total payment to the grower. Fruit sent for









processing generally receives a significantly lower price than fresh. Therefore, it is imperative

that a grower obtains a high packout rate to maximize the amount of his production receiving the

highest price, and minimize the possibility of receiving a lower price for eliminations. This is

mostly accomplished through the spray program and spot picking practices as described in the

previous section.

Fungal diseases and insect damage are the two most common causes of peel blemishes and

reasons for fruit elimination. Fungal infections, such as melanose, citrus scab, alternaria, and

greasy spot, are often controlled using fungicidal sprays containing copper and petroleum oil.

Some insects, commonly mites, attack the fruit/peel and must be controlled using pesticides to

ensure fresh market quality.

Citrus trees are attacked by a number of foliar and root pests and diseases that affect

productivity. When balancing lost productivity with the costs of chemical application, the use of

chemical control is generally required when a certain level of infestation or infection is reached.

Fruit grown for the processing market does not require high external quality. In this case, spray

costs appear to be closer to a variable cost of production which increases with yield.

In Florida, most sweet orange varieties, with the exception of Navel oranges, are grown for

the processing market (Table 2.1). Grapefruit, tangerines, and other specialty varieties are

mostly grown for the fresh market. Due to the factors discussed above, spray costs for the fresh

market varieties are significantly higher than oranges for processing. For example, Table 2.2

illustrates the difference in spray costs between the Hamlin orange variety and the red-seedless

grapefruit, grown for the processed and fresh markets respectively. The reader should note that

these spray programs include micronutrient compounds that are mixed into a solution containing









certain pesticides (Lorsban and copper in this case). Chemical costs for specialty fruit will be

higher than traditional orange varieties for the processing market.

Table 2-1. Florida citrus marketing by variety, 2005-06 season
Fresh Processed Total
'000 boxes % '000 boxes % '000 boxes
Early, Mids, and Navels 4,896 7% 70,104 93% 75,000
Valencia Oranges 2,450 3% 70,450 97% 72,900
Grapefruit-White 1,433 22% 5,067 78% 6,500
Grapefruit-Red 5,481 43% 7,319 57% 12,800
Source: USDA Citrus Fruits 2006 Summary

Table 2-2. Spray budget comparison: fresh versus processed, cost per acre
Hamlin Orange for Processing
Summer Oil #1 88.02
Summer Oil #2 53.17
Total 141.19
Colored Grapefruit for Fresh Market
Post Bloom Spray 53.32
Supplemental Post Bloom Spray 83.15
Summer Oil #1 53.32
Summer Oil #2 88.02
Fall Miticide Spray 38.54
Total 316.35


Growth regulating chemicals are applied to certain citrus varieties for the fresh market to

control heavy alternate bearing between seasons. These heavy crops can be chemically thinned

with Naphthalene Acetic Acid ("NAA") to reduce crop load and allow more even production

between seasons (Stover et al. 2001). Gibberellic acid ("GA") is sometimes applied to processed

orange varieties to delay the time of harvest and increase juice yield and quality, although there

appear to be detrimental effects on subsequent cropping (Stover and Davies 2001). The

application of growth regulators is expensive with an application cost of approximately $35/acre,

and a materials cost of approximately $495/acre and $34/acre, for NAA and GA, respectively

(Muraro 2006c). No growth regulating applications are assumed in the analysis presented









because of the focus on oranges and grapefruit varieties, however for certain, primarily fresh

market citrus varieties, incorporation of these costs is an important component of analysis.

Intuitively, older trees with large canopy volumes should require more amounts of

chemicals, however, there is considerable variability between large tree size, high spray volume,

and increased chemical costs. A 2001 UF-IFAS survey of spraying practices in the Indian River

growing region reported some association between spraying large trees at a high spray volume,

but some growers also reported spraying small trees at a high volume (Stover et al. 2002b). Due

to the high cost of chemicals and the economics of spray efficiency, Florida citrus has moved

quickly to adopt variable rate sprayers that can adjust the amount of chemical material applied to

the tree size. Overall, chemical control for pests and disease requires more spray material to

cover increased canopy size as trees age; however, spray costs and materials for young, small,

and/or non-bearing trees will differ as explained in a following section on young tree care. This

analysis assumes that the grove manager or caretaker uses variable rate spraying equipment

methods to apply the quantity of spray material appropriate for the tree age. These costs are

adjusted according to age as shown in Appendix Table B-8.

A productive citrus grove must maintain a certain level of upkeep during its operation. In

the hot and humid Florida environment, other plant species quickly invade a grove and compete

with citrus trees for water, sunlight, and soil nutrients. Cultivation includes controlling for these

uninvited plants through mechanical mowing and herbicide applications. Labor for general

maintenance and upkeep is required to perform a multitude of necessary tasks around the grove.

While these costs may vary significantly, a grower is certain that they will be incurred.

Estimates of cultivation and grove maintenance costs for the 2005-06 season ranged from $80 to

$100 per acre depending on the grove's location in the state.









The generic term "pruning" generally involves three components in a citrus grove:

pruning, hedging, and topping. Pruning refers to removing selected limbs to alter the structure of

the tree in order to reduce overcrowding between trees in a row. Crowding has a negative effect

on yield, juice, and peel quality. Hedging refers to cutting back the trees from encroaching on

the space between the rows (row middles), and allowing grove equipment to pass through.

Topping refers to cutting the top off the tree to prevent it from being excessively tall. Topping

facilitates harvesting, reduces the amount of spray materials needed, and avoids the shading-out

of other trees (Parson and Wheaton 2006).

The frequency of pruning, hedging, and topping depends on the planting density and

vigorousness of the citrus variety and rootstock. Planting the trees in a tighter spacing will

necessitate more frequent pruning to avoid overcrowding. Accordingly, trees planted on

vigorous rootstocks such as Rough Lemon or Volkameriana will encroach on each other faster

than Swingle or Cleopatra rootstocks. A grapefruit tree will encroach faster than a Valencia

orange tree. The 2004-05 IFAS Citrus Budget reports annualized total costs ranging from $28 to

$44 per acre depending on variety and location. This analysis assumes the pruning costs to be

incurred from the fourth year of tree age onwards.

An adequate citrus fertilization program is essential to cultivating productive and healthy

trees. The fertilization of citrus trees increases yields, growth, and has been shown to aid tree

recovery from damage due to weather, disease, or pests (Morgan and Hanlon 2006). Citrus trees

require a large amount of macronutrients (nitrogen-N, phosphorous-P, and potassium-K), and

smaller amounts of micronutrients (iron-Fe, zinc-Zn, manganese-Mn, boron-B, molybdenum-

Mo, and others). Of these nutrients, nitrogen is the most important and is frequently applied in

the form of solid fertilizer through multiple soil applications per year (Zekri and Obreza 2003).









Micronutrients are applied as foliar sprays, can be combined with other chemical sprays, and are

usually applied as needed when trees exhibit symptoms of micronutrient deficiency.

An individual grove's fertilizer program may vary by soil type, tree age, variety, and

specific grove conditions. Moreover, some growers are now using fertigation techniques where

macronutrients are applied in a liquid form through the irrigation system. A typical fertilization

schedule for oranges requires three annual applications by mechanized fertilizer spreaders of

about 210 pounds per acre with grapefruit requiring about three-quarters (150 pounds) of that

amount (Jackson and Davies 1999). IFAS estimates for show for the 2005-06 season a range of

$50 to $70 per application per acre. This analysis assumes a cost of $205 per acre per year for

oranges, and $157 per acre per year for grapefruit. This analysis does not make an allowance for

micronutrient sprays.

Most Florida soils used for citrus production are acidic with a low pH in their native state

and require infrequent applications of soil amendments to raise their pH. Citrus trees grow best

in a pH range of 6.0 to 6.5, and pH values outside of this range affect the absorption of nutrients

by the tree and may reduce tree productivity and growth (Obreza and Collins 2002). The most

commonly applied amendment to raise soil pH is Dolomite limestone, and this is applied as

necessary by the pH level of the soil. Soil and drainage characteristics of the grove determine

the behavior of soil pH, but for the purposes of this analysis, one ton per acre is assumed to be

applied once every three years for an annualized cost of $13.97.

Horticultural and economic considerations require most commercial citrus in Florida to be

irrigated. Many Florida citrus trees are planted on porous and sandy soils that do not retain

sufficient moisture for the tree all year. A citrus tree becomes drought-stressed if it does not

receive enough water, and this has a negative effect on yields, juice quality, and fruit size (Mongi









et al. 2003). Moreover, irrigation can effectively be used for cold protection during freeze

events, especially for vulnerable young trees (Parsons and Bohman 2006). Finally, irrigation

reduces yield uncertainty and mitigates risk of financial difficulty due to crop failure caused by

drought.

Several different irrigation systems exist and require different components and designs, but

microsprinkler and micro-jet irrigation have become widely adopted by Florida commercial

citrus. This analysis assumes the use of a microsprinkler irrigation system and is comparable in

costs to a micro-jet system. Costs for operating a microsprinkler irrigation system vary by

location due to additional costs for water management in Flatwoods groves.

In the Florida citrus industry, the process of removing a dead or unproductive tree and

replacing it with a new nursery tree is commonly called "resetting", and the tree itself is called a

"reset". Pests, diseases, freezes, lightning, and many other unpredictable and sometimes

unexplainable factors claim the lives of citrus trees. Resetting is an important part of

maintaining a citrus grove at maximum bearing efficiency with a full complement of healthy

trees. The publicly available Florida Commercial Citrus Tree Inventory is conducted every two

years by the FASS, since 1966. Change in commercial citrus acreage is determined by aerial

photography, that identifies the number of existing trees by variety and year planted. The

average tree loss by age group used for this analysis is 1% for trees aged 1-3 years, 1.5% for

trees aged 4-11 years, and 3% for trees 12+ years of age.1





1 This analysis uses an unpublished analysis conducted by Dr. Mark Brown of the Florida Department of Citrus
which compared the changes in the tree inventories by tree age from 1994 to 2004, interpolating for between survey
years. After subtracting for non-bearing trees to eliminate for newly planted trees and for canker eradications, a
linear regression line was fit to account for the increase in losses as trees age. Unfortunately, this data may include
some citrus acreage lost to non-agricultural development, and overestimate the actual tree loss suffered in a healthy
grove; however, interviews of grove managers conducted by the author confirm that these loss rates are reasonable.









Resetting a new tree in a mature grove requires incurring immediate and continuous costs

for up to three years. In the near term, the dead/unproductive tree must be removed and the new

tree purchased and planted. This involves additional labor, materials, and equipment time to pull

out the dead tree and dispose of it, clear weeds, aerate the soil, apply a soil fumigant, and plant

the new tree (Jackson 1994). In the longer term, the newly planted tree requires additional care

such as, removing unwanted sprouting, weed control, special fertilization and irrigation

programs, and the maintenance of cold-insulating tree wraps. See Appendix B for detailed cost

information.

Given the costs involved and the delay for reset trees to come into production, growers

attempt to optimize their resetting strategy for maximum economic gain. Nursery trees are

usually ordered one or two years in advance, and special equipment and labor must be arranged

for planting. IFAS Extension publishes an on-line decision aid for optimal resetting strategy that

includes costs, yields, prices, and loss rates (Roka et al. 2000). It is suggested that in high

density and new plantings, a program of continuously resetting dead/unproductive trees may

increase returns to investment; however, IFAS Citrus Economist Ronald Muraro observes that,

under field conditions, most growers only reset trees every other year (biennial resetting) or

longer (Muraro 2006d).

In addition to grove care expenses, there are general operating expenses which must be

considered. Growers may have fixed costs for buildings, equipment, and other costs that cannot

be allocated just to a single grove or on a per acre basis. Since these costs are highly dependent

on a grower's individual situation, this analysis attempts to limit the number of assumptions

made about a grower's fixed expenses. A per acre cash cost is assumed that captures typical

fixed expenses such as equipment use, structures, and grove administration by charging a









management fee. Property taxes are included on a per acre basis, and a "miscellaneous" cost that

accounts for tools, repairs, and additional grove labor.

Citrus production management in Florida is a highly diverse field, with many grove

caretaking tasks being contracted to third-party caretakers. The spectrum runs from grove

owners who own production equipment (tractors, sprayers, harvesting equipment, etc.) and hire

employees, to owners who contract all production work, including harvesting, for a set fee or

percentage of revenue. IFAS citrus production budgets designate the former as an "owner-

managed" operation, and the latter as a "custom-managed" operation. In the custom-managed

production costs, IFAS citrus production budgets incorporate a 10% surcharge on materials cost

(chemicals and fertilizer), and use "custom" rates reported by grove caretakers and managers.

Many growers fall in between these two extremes, and own some grove equipment, perform

some production work themselves, contract for other work, or perform contract work themselves.

In this analysis, costs are reported for an owner-managed operation. Figures given for

spray and fertilizer materials costs are reduced by 10% from reported IFAS citrus production

budgets. All other grove care costs reflect an owner-managed operation with equipment

depreciation incorporated into the costs. A 5% "management" charge is applied to account for

other fixed and indirect expenses not directly incorporated into the grove care costs.

Property tax on Florida agricultural land is known as the millage rate, and is calculated on

a per $1000 of assessed value basis. Reported millage rates range from a low of 11.5 per $1000

of assessed value (1.15% per year) in Collier County to a high of 29.6 per $1000 (2.96% per

year) in Pinellas County. Millage rates for the top four citrus producing counties are illustrated

in Appendix B Table B-11 (Hodges et al. 2003).









The land value used for property tax assessment (the assessed value) of agricultural

enterprises will usually be lower than the market (just) land value. The tax-assessed value is

based on the value of the land derived from the returns to agricultural use. The procedure used

to assess agricultural value differs by county and the tax assessed land value varies widely. In

this analysis, an average millage rate of 19.5 (1.95%/year) is assumed, with an assessed value of

$3,600 per acre for a mature grove, and $1,550 per acre for a new planting or replanting which

results in about $70 per year and $30 per year in property taxes, respectively. The values were

put into 2003 figures because that is the last publication available with all country agricultural

property tax rates collected (Hodges et al. 2003). The just value given for a mature grove and a

new/replanted grove is taken from the 2003 IFAS Florida Rural Land Value Survey (Reynolds

2003). The dollar amount of property tax is assumed to increase by 2.5% per year over the 15-

year period of analysis reflecting natural growth in the value of agricultural and basic inflation.

A miscellaneous cost of 2% of grove care expenses is added to account for general grove

labor and materials. In the base scenario, this cost varies from $14.65 per acre for oranges on the

ridge to $19.80 per acre for grapefruit on the flatwoods. This is based on the observation that

there are many indirect costs and expenses incurred in grove management for additional labor,

tools, and materials.

Cash outflows (expenses) to pay for the previously described expenses are incurred

throughout the year. Citrus trees in Florida produce one crop per year that generates a cash

inflow (revenue). Many different payment schemes exist where growers contract for delivery of

the fruit and receive a portion of the total payment before delivery. One method to value the

timing mismatch between cash inflows and outflows due to operations is referred to as working









or operating capital. Working capital is an accounting term that is defined as current assets

minus current liabilities. It consists for three important components:





Working Capital = Inventory + Accounts Receivable Accounts Payable
(Sales Revenue) (Operating Expenses)



Figure 2-2. Working capital illustration

In the normal course of business, income and expenses are not instantly converted into

cash, but credited to or debited from a receivables(income) or payables(expenses) account.

Many suppliers of agricultural materials and equipment extend credit or delay payment for a

certain period. Inventory is usually considered an asset in working capital because it can quickly

be converted into cash to pay expenses. In the case of citrus, the fruit cannot be harvested before

maturity, but it can be contracted for delivery and some payment received. Working capital

reflects the liquidity of a firm, and changes with the mix of cash inflows and outflows. For

example, a larger crop size would increase a grower's accounts receivable if the fruit was already

contracted at a specific price per box. Therefore, working capital increases as the grower has

more money with which to pay his/her bills. If grove care expenses increase, accounts payable

increases and working capital decreases.

A in Working Capital Cash Inflow Cash Outflow
Increase in A/R (+) (-) --
Decrease in A/R (-) (+) --
Increase in Estimated Crop (+) (+) --
Decrease in Estimated Crop (-) (-)--
Increase in A/P (-) -- (-)
Decrease in A/P (+) -- (+)


Figure 2-3. Application of working capital to citrus investment









Although the actual cost of maintaining working capital throughout the season varies

significantly by grower circumstance, in this analysis an interest charge of 6% on operating

expenses is incurred for a period six months out of each year of analysis. This is assumed to

account for the costs of maintaining sufficient working capital for production of that year's crop.

Tree Yields

Yield expectations per tree in generalized Florida growing conditions are summarized from

published data. The Florida Agricultural Statistics Service (FASS) division of the USDA has

calculated average yield by tree age, variety, and region of Florida (Indian River, North &

Central, West, and South) since 1993. The USDA derives the average yield per tree by using the

Commercial Citrus Inventory's record of trees by age and end-of-season field samples of

production per tree by age (Florida Agricultural Statistics 2006). Appendix Table B13

summarizes the FASS data by tree age and region. At the time of writing, the state average

yields by tree age over the 2000-2005 period are available, but were not used because they are

lower than previous periods due to the effects of the 2004-5 Atlantic Hurricane Season,

especially for the Indian River and Western regions. Since 1960, the Savage yield-tree age study

was frequently used by growers to benchmark their own grove's results (Savage 1960). The

Savage study may no longer be applicable due to its limitation to ridge groves and low-density

plantings (48 to 70 trees per acre). More recent studies by the researchers at the University of

Florida-IFAS track box and juice yield by tree age in higher density plantings at both ridge and

flatwoods sites. A study of Valencia oranges on twelve rootstocks by Dr. William Castle tracks

box and juice yields by tree age over a 15 year period in both ridge (Avon Park) and flatwoods

(Indiantown) locations (details in Appendix Table B14, Castle 1994). The findings indicate a

trend in high-density plantings in that production per acre reaches a maximum and plateaus










earlier, around year 10 or 11 of tree age, than trees with wider spacing. This is due to trees

competing with each other for sunlight, water, and nutrients (Parsons and Wheaton 2006).

Fortunately, the reduced per tree yield is compensated by a greater number of trees for

comparatively more production per acre.

Another study of high density (150+ trees per acre) flatwoods plantings at theUF/IFAS

Southwest Florida REC examined Valencia and Hamlin oranges primarily on Carrizo and

Swingle rootstocks and confirms the plateau of box yields around 8 to 10 years of age.

Moreover, a comparison of the Valencia and Hamlin orange varieties shows that Hamlins

produce between 100 and 120 boxes per acre more than Valencias. (Roka et al. 2000).

Additionally, while Hamlins produce less pounds-solid per box, Hamlins annually out produce

Valencias by 200 to 800 pounds-solid per acre.2

Pounds-solid per box varies due to various biological and environmental factors, and also

depends on variety and rootstock. In addition to the quantity of pounds-solid per box, the quality

of juice is important. Juice with a good color and a sufficiently high sugar to acid ratio (Brix

ratio) receives a premium from juice processors. Late-season Valencia oranges usually exhibit

better juice quality than early-season Hamlins, and the price per pound-solid for Valencias are

generally higher than the price paid for Hamlins (Spreen et al. 2001). Varieties grafted to

rootstocks such as Carrizo, Sour Orange, and Swingle tend to give higher pounds-solid than



2
2Pounds-solid is very important for oranges sold for juice processing because growers are paid on the basis
of the pounds-solid measure of juice quantity and not the number of boxes. While a box of oranges always weighs
901bs, the quantity and quality of juice that can be squeezed from the fruit varies. Orange juice contains water,
sugar, and a diverse range of other organic molecules. Sugars constitute about 75% of the dissolved solids in orange
juice, and are directly proportional to the quality of the juice. The density of the dissolved solids in the orange juice
is measured in degrees Brix, named after the German scientist who discovered how to measure this relationship.
Degrees Brix is converted into the percentage of soluble solids in the juice and multiplied by the amount of juice
squeezed per box to arrive at the number of pounds of solids (abbreviated to pounds-solid or p.s.) per box of
oranges.









Rough Lemon and Volkameriana (Jackson and Davies 1999, Castle 1994). When interpreting

the results of this analysis, it is important to remember these differences in breakeven prices.

The preceding sources were used to construct an average box and pounds-solid yield per

tree by age for this analysis. Differences in topography, soil, climatic conditions, and grove care

all play a role in the yields of a particular grove; however these yields are assumed to control for

random effects and represent what a grower can expect from a healthy, well-managed tree.

Therefore, the above information was adjusted with the opinion of IFAS experts to reflect the

expected average yield of a typical Florida grove using standard grove care techniques (Muraro

2006d). Unfortunately, no detailed studies of grapefruit yields exist; instead an approximation of

the state average yields for colored grapefruit is used and adjusted for higher densities. Pounds-

solid are not calculated for grapefruit because it is assumed that grapefruit is produced for the

fresh market. The analysis yields also incorporate a resetting effect due to the resetting of only

half of the total tress lost after year 10 of grove age, which makes more space available for each

tree. The maximum yield in year 10 was increased by 10% for years 11-15 due to trees growing

out into the wider spacing.









CHAPTER 3
ACCOUNTING FOR THE EFFECTS OF CITRUS CANKER AND GREENING ON
FLORIDA COMMERCIAL CITRUS PRODUCTION

The Florida citrus industry currently faces two new disease challenges with unpredictable

consequences. Citrus canker is a bacterial disease of citrus that causes unsightly lesions on citrus

leaves and affects tree productivity. Citrus greening, or Huanglongbing (HLB), is a bacterial

disease of citrus that quickly kills trees. Both diseases are highly contagious and have the

possibility of spreading rapidly through commercial production areas of the state. Under the

canker eradication program, any tree detected with citrus canker was required to be eradicated,

along with all other trees within a 1900-foot radius. Growers were compensated by the USDA-

Animal and Plant Health Inspection Service (APHIS). This program was halted in January 2006,

and the management of canker is now the responsibility of individual growers. In August of

2005, citrus greening was first detected in a residential citrus tree near Homestead in Dade

County, and has spread to all of other citrus producing counties. The Florida Department of

Agriculture and Consumer Services (FDACS) made it known that there will not be a greening

eradication program. Florida commercial citrus production is entering an environment of

endemic citrus canker and greening. Due to the novel nature of these challenges to citrus

production, this analysis surveys current academic literature on these diseases in order to

describe their grove-level effects on citrus.

Citrus Canker

Canker bacteria are spread by windblown rain, human and mechanical contact. It enters

the citrus tree through natural openings and wounds in the protective outer tissue of the trees, and

is exacerbated by the citrus leafminer insect. Depending on weather conditions, canker

symptoms appear from about a week to a couple months after infection, and are especially

virulent in hot and humid weather. Severe infections may cause defoliation, badly blemished









fruit, premature fruit drop, and tree decline (Schubert and Sun 2001). Studies suggest that the

canker bacteria can be spread over two miles from normal wind and rain alone, with longer

distances of 10 miles and greater possible due to hurricanes and other severe weather events

(Gottwald et al. 2002a).

Florida's first experience with citrus canker was an outbreak around 1910 that was not

eradicated until 1933. Canker is hypothesized to have arrived in Florida on plant material

imported from Japan (Gottwald et al. 2002 II). After 53 years, canker reappeared in Manatee

county in 1986, and after an extensive eradication program, it was declared eradicated in 1994.

The next year, canker reappeared in a residential citrus tree near Miami airport, and was the

focus of the most recent eradication program. From 1995 onwards, citrus canker was subject to

an eradication program which until 1999 destroyed all trees within a 125 ft. radius of an infected

tree. In 1999, a new study showed that canker was spread much farther than previously thought,

and a 1900 ft. radius of eradication was mandated, plus any cleared land was required to be left

fallow for 2 years. The "1900 ft. rule" was statistically determined to eliminate 99% of the

bacteria spread within 30 days. According to a USDA study, Hurricane Wilma in 2005 may

have exposed 168,000 to 220,000 acres of commercial citrus to canker, in addition to the 80,000

acres already exposed by the 2004 Hurricanes Charley, Francis, and Jeanne (FDACS 2000a).

Approximately 7.5 million commercial trees, 860,000 residential trees, and 4.3 million

nursery trees were eradicated from 1995 until the end of the program. Canker finds are now

reported in all of the top twelve citrus producing counties. (FDACS 2006 II) With the halt of

the citrus canker eradication program, canker will now likely become endemic to Florida for the

first time in the history of the industry.









The effects of canker in a citrus grove depend on the susceptibility and market outlet of the

fruit. White and colored grapefruit, Persian (Tahiti) limes, and early and midseason oranges

(especially Navel and Hamlin varieties) are the most susceptible citrus varieties. Valencia

oranges, tangelos, and tangerines appear to be less susceptible to canker (Gottwald et al. 2002b).

Canker does not affect the juice quality of fruit, but the unsightly canker peel blemishes and

quarantines against fresh fruit shipments from canker infected areas lead to the conclusion that

the profitability of fresh market citrus will be impacted more severely than citrus for juice

processing. Studies of citrus production in certain areas of Brazil and Argentina where canker is

endemic suggest guidelines for specific integrated management programs for the control of

canker in a grove (Leite and Mohan 1990, Spreen et al. 2001a, Muraro et al. 2001).

Tree Loss and Yield Reduction Due to Canker

Canker has not been conclusively shown to kill trees in the short and medium term, but a

severely infected tree may become unproductive, and serves as a source of inoculum (bacteria)

that can be spread to neighboring trees. An integrated management program includes removal of

infected trees and some neighboring ones. This analysis assumes an increase of 10% in

historical tree loss rates for all age categories.

The hurricane seasons of 2004 and 2005 not only spread canker through commercial

groves but affected large numbers of citrus tree nurseries. As of 2004, 70% of Florida citrus

nurseries were "field" nurseries where trees are grown outdoors, and are vulnerable to wind and

rain spread canker. Canker eradication destroyed nearly two-thirds of the existing nursery tree

inventory, and eliminated important sources of budwood for propagating new trees (Spreen et al.

2006). Few nursery trees were available for the next two years, with limited production for the









next three to five years. This analysis uses a figure of $7.50 per tree to account for increased

price due to decreased supply during the next 2-5 years.

Susceptibility and canker's resulting damage to a tree varies by citrus variety. Infected

trees exhibit twig dieback and leaf, flower, and fruit drop (Gottwald 2006 II). Hamlin oranges

and grapefruit are considered highly susceptible, and information from Argentina's experience

with endemic canker indicates possible yield losses of 10-20% for highly susceptible varieties

(Spreen 2001). This analysis assumes a yield penalty of 10% for Hamlin oranges and grapefruit.

Valencia oranges are considered moderately susceptible, and are assessed a lower yield penalty

of 5%.

Canker Management: Augmented Spray Programs

Canker increases the cost of spray programs for the most susceptible varieties, especially

grapefruit for the fresh market. Studies show that copper sprays reduce the canker inoculum

(bacteria) build up on the leaf and fruit surfaces of infected trees, with 3-5 annual sprays for

moderately susceptible varieties and 4-6 for highly susceptible varieties (Gottwald 2006b). The

citrus leafminer insect is currently under somewhat successful biological control, and also is

controlled for by oil-based spray applications (Heppner 2003).

For the purposes of this analysis, it is necessary to determine the additional spray material

and application costs canker adds to standard spray programs. Copper spray is already widely

used as a fungicide/bactericide in Florida to control for melanose, greasy spot, and scab,

especially for the fresh market (McCoy et al. 2005). Petroleum-based oil sprays are also used

extensively to control for insects such as scales, and other diseases. Many of these sprays can be

mixed together, and applied at the same time. Upon consultation with IFAS Lake Alfred CREC

experts, additional spray applications, schedules, and costs were determined for canker control









(see Appendix Table B-17). Valencia and Hamlin oranges for the processed market, and

grapefruit annual spray costs are expected to increase $20.96, $48.17, and $35.26 per acre,

respectively.

Canker Management: Field Inspections

Aggressive field inspections and decontamination of workers and grove equipment to

identify canker sources and control its spread are a vital part of the canker management program.

Three yearly field inspections by trained personnel were estimated at $5.84/acre/inspection

(Muraro 2006d). This cost was calculated for a 120-acre grove, using nine inspectors and two

vehicles, and may vary depending on the size and location of the grove.

Canker Management: Windbreaks

Windbreaks are densely planted stands of large trees not susceptible to citrus canker

planted along the borders of a grove or block of citrus. The intent is that the protection of the

trees will stop or deflect the spread of windblown canker for outside sources. This has proved

successful in Argentina and Brazil for protecting groves, and is a likely part of an integrated

canker management program, especially for fresh market fruit (Leite and Mohan 1990). The

annual cost used in this analysis for establishing and maintaining a windbreak is estimated to be

$11.47/acre for a 10-acre block over 20 years, and in this analysis is only included for grapefruit.

There may be additional costs due to lost production from the reduction in grove area planted in

citrus and the shading out of existing trees that are not included in this analysis (see Appendix

Table B 15 for a detailed breakdown of costs and additional information).

Canker Management: Packinghouse and Export Certification for Fresh Market Citrus

Fresh fruit must be handled in designated packinghouses where fruit is treated with

disinfectants, and some processing plants and packinghouses refuse to accept fruit from infected









groves. In the future endemic canker environment, packinghouses are expected to pass along the

cost of special handling to growers. This analysis assumes $.10 per box (or $40.50/acre @ 450

boxes/acre) based on conversations with industry professionals and academics. Moreover, it is

likely that the DPI will require special inspections for groves exporting internationally, and this

cost is estimated at $60/acre. In the analysis, these costs are only incurred for fresh market

grapefruit after the trees become commercially harvestable at three years of tree age.


Citrus Greening

Citrus greening or Huanglongbin (HLB) is a bacterial disease of citrus native to Asia.

Greening (bacteria species name: Candidatus Liberibacter) gets its name from the small, green

fruit produced by an infected tree. Infection causes the quick decline and death of a tree in about

two to four years. After its initial detection in August of 2005 in Homestead, greening has

spread throughout the state. Greening is spread by an insect vector named the Asian citrus

psyllid which is widely distributed throughout the state and is difficult to control. The exotic

nature of greening in Florida and lack of a definitive management program means there is very

little information about the effects of greening on the production and costs of a grove. Greening

has devastated the citrus industries of other countries, but little is known about how greening will

behave in the intensive grove management environment of Florida. Most existing literature on

greening is found in scientific journals specializing in virology or plant pathology. As of this

writing, there exist only two studies of the economic impact of greening (Grezebach 1994,

Roistacher 1996), and both study greening's effect on the Thai citrus industry. Other countries'

experiences with greening serves as the basis for the assumptions reached below, and may not

reflect the realities of greening in Florida.









Literature Survey of International Experiences with Greening

In Taiwan, greening was first discovered in 1951 with significant spread by 1970's. Its

transmission was spread by propagation with infected material and the psyllid vector. In a field

study with .78 Ha (240 tangerine trees) in a greening endemic area with no control, psyllid

infestation was found five months after planting, with 89% of trees infected within eight months

after the infestation was discovered (Chen 1998). Trees expressed symptoms of greening and

dieback approximately two and one-half years after the initial infection.

A greening-like disease (CVPD) was first discovered in Indonesia in the 1950s, and was

present in most major production areas by a 1984 survey (Vichtranada 1998). With an integrated

pest management program (IPM), yields increased 200% in certain areas.

A Vietnamese survey conducted in 1995 found greening in all citrus production areas of

Vietnam, and it was observed that four to seven year-old trees were particularly damaged. A

field study often hectares at six sites (tangerines and oranges on trifoliate and volkameriana

rootstocks) showed that disease-free trees planted in greening endemic areas, with limited psyllid

control suffered a re-infection rate of 16% to 100% (Hong 1998). The lowest rate was attributed

to a long proceeding fallow period. Before infection, the orange trees yielded 220 boxes per

acre, and after infection only 43 boxes per acre.















250 60,000,000

-Y- Yield IBox Acre) 50,000,000
200
-Production immlbx
40,000,000
S150 -1987 Firsl I.P.M.
SI~mplimenled 30,000,000
30,000,000

100
20,000,000

50
10,000,000


0 0

SOURCE: FAOSTAT, 2005
Figure 3-1. Indonesian citrus production, 1975-2005

In Thailand, greening had a devastating impact on commercial tangerine production, and


reduced average tree life expectancy from eight to ten years with a 10% to 15% annual death


loss. The use of air-layering (marcotting) for propagation and limited insect control programs


contributed to greening's spread over all areas of Thailand. The highest tree loss was for one to


two year-old trees, with tree death by three to four years. It was observed that newly infected


trees were usually found clustered in the front row of the block adjacent to nearest previously


infected block of citrus. In a field study with spray program in endemic greening and canker


area, spraying at 7-day intervals with copper oxichloride mixed with methamidophos,


carbosulfan, imidaclopid, and methomil resulted in no infections (Vichitrananda 1998).














160 30,000,000

140
25,000,000
120
20,000,000
100 -1996 I P M
Iniplinlenled
S80s 15,000,000

60
10,000,000
40
5,000,000
20 f- ----- I, I r.---I-- r



SOURCE: FAOSTAT, 2005

Figure 3-2. Thai citrus production, 1975-2005





The South African strain of greening was first observed in the 1920s, with an estimated


60% of all South African citrus trees infected by 1970. Greening eliminated citrus production in


the Transvaal and Natal provinces. Due to the implementation of a successful IPM program,


commercial production is returning to some areas previously abandoned because of the effects of


greening. Some highlights of South Africa's IPM program are as follows:


Resetting in mature groves with history of greening is not recommended


Trees less than five years old are eradicated with any sign of greening


Trees five to ten years old are eradicated if 75% or more of the canopy shows signs of
greening, infected branches are pruned otherwise


Ten or more year-old trees are not commonly eradicated, but branches with greening are
pruned


Coordinated psyllid spraying among adjacent groves


(Buitendag and Von Broembsen 1995).














300 60 000 000


250 50,000,000


200 40,000,000


I 150 Mid 1970's First
S I P M implimenled


100 20,000,000


50 10,000,000
0 I- re-,,:h_,:- -------,
0 0

SOURCE: FAOSTAT, 2005

Figure 3-3. South Africa citrus production, 1975-2005


Projected Florida Tree Loss Due to Greening


Given international experiences with greening and the preference of psyllids for new


growth, the tree loss rate is expected to be proportionally higher for young trees. While the exact


impact of greening on trees by age has not been studied, this analysis assumes a range of possible


tree loss due to greening, given by three scenarios: Low, Medium, and High tree loss. The


statewide historical loss rate is increased by the following amounts, and the annual tree loss rates


are summarized in Table 3-1.


Table 3-1. Tree loss percentages used in analysis
TREE AGE BASE* GREENING


CANKER


Low Med High
1-3 1.00% 2.00% 2.50% 4.00% 1.10%
4-11 1.50% 2.63% 3.00% 4.50% 1.65%
12+ 3.50% 5.25% 6.13% 8.75% 3.85%


* Estimated average state historical tree loss (excluding effects of development and eradication)


300


60.000.000









Greening Management: Psyllid Control

The psyllid insect vector of greening is difficult to control because the psyllid population

spikes at certain times of the year, exhibits continuous movement between citrus trees and

surrounding host vegetation, and has a wide range of other host plants besides citrus. Moreover,

its small size and recent arrival to Florida makes it difficult for growers not familiar with the

insect to discover its presence in the grove. Psyllids feed almost exclusively on new growth

flushes, and adult psyllids are able to acquire and transmit greening within 24 to 48 hours

(Buitendag and Broembsen 1992). The importance of a coordinated psyllid IPM was illustrated

in Indian field tests that found that 67% of certified greening-free trees were infected three years

after planting if greening was present on adjoining properties (Azzaro et al. 1993). Chinese

researchers successfully eliminated all greening incidents by the eradication of all backyard

citrus and other host plants in area, the use of windbreaks, the planting of certified greening-free

trees, the application often to thirteen psyllid-specific sprays per year in flush periods, and the

prohibited introduction of any host plants in general area (Ke and Xu 1990). Another Chinese

study tested the possibility of rehabilitation of an infected grove by pruning all infected branches

and applying 10 to 13 psyllid specific sprays per year. This resulted in reducing new infections

from 2.5% to 1% over eleven years in one location, and 7% to 1% over nine years in the other

(Xu et al. 1991). Moreover, ten to twenty psyllid-specific sprays per year does not appear to be

feasible for both economic and environmental reasons.

From the international experience with greening, a South African study of different psyllid

control programs found that:

Multiple sprays aimed at maintaining low populations of psylla throughout the spring,
summer, and autumn periods were impractical and caused pest repercussions. It was then
realized that systemic treatments targeted specifically at psylla and applied either to the
stem or to the roots would be most effective (Buitendag and Von Broembsen 1992).









Experiments in psyllid control in Florida have shown that foliar applied insecticides such as

Danitol, Lorsban, and petroleum oils are useful for short-term control of spikes in psyllid

populations, while foliar or soil-applied systemic insecticides such as Provado, Temik, and

Admire are useful for long-term control. Admire is used on young, non-bearing trees, and Temik

is used on older, productive trees (Rodgers 2006). To augment the standard citrus spray

program, this analysis assumes annual Temik or Admire applications in their maximum

allowable amounts, plus one additional Danitol and Lorsban application per year. This results in

a cost increase of $203.00/acre for oranges on the Ridge, $194.36/acre for oranges on the

Flatwoods, and $156.74/acre for grapefruit, added to the existing grove spray program results in

the chemical costs shown in Appendix Table B17. The grapefruit for fresh market costs do not

increase as much as the oranges for processing because of the ability to combine greening spray

applications with the existing spray program.

Greening Management: Grove Inspections

Greening's ease of transmission makes it necessary to scout aggressively for signs of

psyllids and infected trees. Infected trees should be eradicated immediately, and psyllid

populations controlled promptly to avoid a quick spread throughout the grove (Brlansky 2005).

This analysis assumes that growers must inspect six times per year. Using the same cost

components as the canker inspection program described above, the annual cost of greening

inspections is $35.04/acre.

Combining the Effects of Canker and Greening

To account for the combined effects of canker and greening in a grove, the above cost

categories, yield, and tree loss assumptions are added together and overlaps, particularly in the

spray programs are subtracted. A comparison of spray programs with different disease scenarios









is shown in Appendix B Table B-17, while a detailed production budget of different groves and

varieties with both canker and greening is illustrated in Appendix B Table B18. Inspection

costs are assumed to be the higher figure for eight annual inspections ($35.04/acre) for both

canker and greening. The canker yield penalty is included (5% for Valencias and 10% for

Hamlins and grapefruit), and the medium greening tree loss rate is assumed.

Table 3-2. Annual per acre spray costs by disease scenario
Scenario Ridge Flatwoods
Valencia Hamlin Valencia Hamlin Grapefruit
Base $137.06 $137.06 $141.19 $141.19 $383.18
Canker $153.20 $189.36 $153.20 $189.36 $418.43
Greening $335.55 $335.55 $335.55 $335.55 $539.91
Canker & Greening $335.55 $371.71 $335.55 $371.71 $539.91
Source: IFAS 2004-5 Citrus Production Budgets adjusted for BMP disease spray programs









CHAPTER 4
A NET PRESENT VALUE MODEL OF A FLORIDA CITRUS GROVE

The definition of an investment used in this analysis is the ownership of an asset that has

value. The value of an asset is created by intrinsic value and/or the value of the income it may

produce. Unless this asset is inherited or received as a gift, the ownership of the asset must be

purchased with another asset of value. In this analysis, value is framed in monetary (dollar)

terms. The preferred goal of an investment is to capture a return that is in excess of what it costs

to obtain the asset.

In the case of an investment in a citrus grove, initial costs are incurred in the purchase of

the land and establishment of the trees. This is based upon the expectation of creating value

from the future income from the production of the fruit and the ownership of a productive grove.

Due to the long life of a productive grove, it is necessary to determine the value of the future

production and ownership currently to compare it to the costs that are incurred now. Net present

value analysis is a means of comparing the future expected returns to ownership of a citrus grove

to the current cost of acquiring it.

A citrus grove is a dynamic enterprise where yields, revenues, costs, and grove value

change through time depending on tree age, tree loss, fruit prices, and input costs. This analysis

adapts a mixed-age grove model to reflect grove operating costs and revenues. This mixed-age

grove model captures the evolution of costs over time, including the costs of tree loss, resetting,

and caring for replacement trees. Both box and pound solids yields increase with tree age, and

with resetting it is necessary to capture the effect of a mix of tree ages on total grove yields.

Accounting for trees of different ages within a grove becomes even more important when higher

tree loss assumptions due to disease are incorporated. Generalized examples of the model's









mechanics are given below, but the reader is referred to Appendix C for results generated by the

model for a Valencia orange grove in the Central Florida ridge production area.


Net Present Value Theoretical Framework

Net present value (NPV) is a frequently used way of evaluating and comparing

investments, also known as capital budgeting in the finance literature. A 2001 survey of 392

chief financial officers for business ranging from small private business to Fortune 500 public

corporations found that around 75% use the NPV method of project analysis (Graham and

Harvey 2001). Around 50% of firms used sensitivity and scenario analysis methods. This study

borrows commonly used investment analysis techniques of NPV and scenario analysis from the

corporate finance field, and adapts and applies it to citrus growing in Florida.

Present Value Investment Rule

NPV begins with the assumption that the value of a dollar received today is worth more

than a dollar received tomorrow because a dollar today can be used or invested. Determining the

present value (PV) of future payments or cash flows requires a method to discount their future

value by the perceived opportunity cost of waiting for them.

Cash flows in consecutive future periods that are discounted by the same rate sum up to

form the present value. The series of present values are additive and the discount rate

compounds in a geometric sequence where it is raised to the power of the future time period.

Consider the below case of three yearly cash flows discounted at a rate of 10% per year.

4.1) PV = 100 + 100 + 100
(1+.10)1 (1+.10)2 (1+.10)3

100 + 100 + 100
1.1 1.21 1.33

90.91 + 82.64 + 75.13 = 248.68









The generalized formula of the sum (2) of the present values of the cash flows (CF) in future

time periods (t) is represented by the following:



T
(4.2) PV = 2 (CF)
t-o (1 + rt)t



where CFt is the current value in period t and r is the interest rate.

Net present value (NPV) adds the initial cash flow to the present values of future cash

flows. NPV is used to adapt the present value framework to the reality of most investments.

Usually, the initial cash flow is a negative outlay used to acquire an asset assumed to be

purchased now, and therefore is not discounted.3


T T
(4.3) NPV = (CF)t + CFo or (CF)t -Initial Investment
t=o (1 + rt) t-o (1 + rt)


When investing in an asset, the investor is foregoing the return available by investing in another

asset. The discount rate (r) is a method to incorporate the opportunity cost of choosing an

alternative investment, and establish a required rate of return for investing in the asset. This

gives two equivalent decision rules for capital investment:

Net Present Value Rule. Accept investments that have positive net present values. In other
words, the difference between the present value of future income minus the cost of
acquiring the investment is a positive number.





3 This analysis will use the cash flow sign convention of expenses are negative cash out flows (-) and income is a
positive cash out flow (+).









Rate-of-Return Rule. Accept investments that offer rates of return in excess of their opportunity
costs of capital, or the rate of return of the investment exceeds the rates of return on similar
investments.

Alternative Investment Rules

Three traditional alternatives to the NPV investment decision rule are the book rate of

return, payback period, and internal rate of return (or hurdle rate) (Brealey and Meyers 2003).

These rules are commonly used and may lead to misleading conclusions and incorrect decisions

based on their results. It is important to remember that NPV depends only on forecasted cash

flows and the discount rate or opportunity cost of capital.

Book income is another name for accounting income, and it used to determine the book

rate of return. Book income is commonly shown on a firm or individual's income statement, and

book assets and shareholder's equity are shown on the balance sheet. Both are reported using

accrual accounting methods which may not reflect actual cash inflows and outflows. The book

rate of return is the basis for ratios such as the return on assets (ROA) or return on equity (ROE).




(4.4) Book rate of return = Book Income or Book Income
Book Assets Shareholder's Equity


Accounting procedures separate cash outtlows into capital and operating expenses. Capital

expenditures are depreciated and debited against income according to a schedule that may not

reflect the actual cash flows; also, the allocation of capital and operating expenditures is usually

reported across an entire firm or individual's income and balance sheet, and not on an individual

project or investment basis. When evaluating a capital investment decision, it is important to

remove the distortive effects of the choice of accounting methods from the actual value of the

investment; however, there are benefits to tax, depreciation, and financing choices. Elsewhere,

this analysis includes a framework for how to calculate these ancillary benefits.









The payback method is an investment rule which specifies the number of years it should

take for the cumulative discounted cash flows (DCF) of an investment to pay back the initial

investment expenditure. Graham and Harvey (2001) found that the payback method was

predominantly used by smaller firms. The payback method is another way to account for

investment risk by limiting one's time exposure to risk. When evaluating competing projects,

the project with the shortest payback period is selected. First, this method ignores cash flows

after the payback or break-even date. An investment may create significant value after the

establishment of an arbitrary cutoff date. Second, the payback method is biased towards

investments with large cash flows early in their lives. Longer-lived investments may generate

significantly more returns on a DCF basis.

The internal rate of return (IRR or IROR) is an investment rule related to the NPV rule,

where the rate of return from discounted cash flows is compared with the discount rate or

opportunity cost of capital. The opportunity cost of capital is the "hurdle rate" by which the

returns to investment must exceed for a firm to invest. Therefore, if the return of the discounted

cash flows is greater than the cost of purchasing the investment, a firm will choose to invest. By

definition IRR is the discount rate which makes the NPV equal to zero, and is found by

substituting IRR into the NPV formula and solving.

(4.5) NPV = 2 (CFl + CFo = 0
t=0 (1 + r)t
T
r = 2 (CF)f 1 = IRR
t-o -CFo

Or

NPV = CFo + CF1 + CF2_ ... t
(1+IRR)1 (1+IRR)2 (1+IRR)t










The IRR illustrates the important aspect of NPV which is its inverse relationship to the

discount rate. As the discount rate increases, the present value of future cash flows decreases

and NPV becomes smaller. This relationship can be represented by the downward sloping line

shown in Figure 4.1. Where the line crosses the discount rate axis is where the NPV of an

investment is equal to zero. That rate is the IRR, in this case 35%. The IRR must be compared

to the discount rate to either accept or reject the investment. For example, if the discount rate (r)

is 20%, the opportunity cost of capital is less than the internal rate of return to the investment

(IRR) of 35%, and the NPV is +$1,200. Therefore, the investment will be accepted. If the

discount rate (r) is 65%, the opportunity cost of capital is greater than the IRR (35%), and the

NPV is -$1,000. Therefore, the investment will be rejected.


Net Present Value ($)


+2,000 IRR =35%
NPV=+1,200
+1,000 r65%

0 Discount
NPV=-1,000 Rate (%)
5% 5 75% 100%
-1,000

-2,000 r= 20% o Firm's NPV




Figure 4-1. Relationship of NPV and IRR

The IRR is a polynomial equation for multiple periods, has no unique solution, and must

be solved numerically through interpolation to find an accurate value. Fortunately, this can be

done instantly through the use of spreadsheet-based computer programs or financial calculators.

Unfortunately, an investment's NPV function is not always as smooth as the line in Figure 4.1.

The IRR method will give an inaccurate figure if there are changes of signs in the cash flow, or









large positive cash flows early in the investment's life. For instance, if there are many swings

where the DCF's go from positive to negative, this may give multiple IRR's if the function

crosses the discount rate axis more than one time. The IRR is calculated in citrus grove

investment analysis because it can be useful in some situations to compare the profitability of an

investment to its opportunity cost, but NPV is a more reliable measure of value over time and an

absolute measure of the total value created.

Adapting NPV to Citrus Investment

To adapt the NPV framework to a citrus investment, it is first necessary to construct the

cash flows. In its most basic form, the cash flow to growing citrus is a function of yield, price,

and cost. In each period there exists a yield of fruit which is multiplied by the price for the fruit

minus the operating cost. The first period (period 0) is typically referred to as the initial

investment. This is the cash out flow necessary to acquire the grove whether it is the purchase of

a mature grove or the cost for establishing a new or replanted grove. In this analysis, it is

necessary to distinguish two indexing variables of time (t) and tree age (a). Time is the analysis

time which starts in year 0 (present day) and moves forward 15 years or periods. This is distinct

from tree age (a) which will change depending on the beginning age distribution of the grove and

amount of tree loss incorporated into the model. Yields and costs change with time, tree age,

variety (V), tree loss ('), and the presence of disease (0). In this case, the disease considered is

either canker or greening, and is separated from normal tree loss in a grove. Price (P) is treated

as an exogenous variable and is used to measure the effects of changes is yield and cost due to

disease.










(4.6) -CFo = Initial Investment

(4.7) CFt = P Yt Ct, where Y(t, a, V, Y, 0) and C (t, a, V, T, 0)

t = analysis time period
a = tree age
V = tree variety
Y = tree loss
0 = disease effect


Exiting the Investment: Bond Valuation, Perpetuities, and Terminal Value

The additive property of present value makes it an attractive method for determining the

value of an asset with a long series of future cash flows. Although, one must determine a cash

flow for each period of the asset's expected life. This becomes difficult and time consuming

when the asset has a very long or indefinite life. A well-maintained citrus grove is usually

expected to last at least fifteen years to thirty years, and may last much longer. A grove owner

expects that the grove will retain a terminal value as an income producing property after the

expected life of the grove due to its suitability to be replanted in citrus. This creates an issue of

how to determine the present value of all the future returns accruing to ownership of a grove.

The method of valuing of one of the most basic financial instruments, the bond, illustrates

a path to valuing a citrus investment. A fixed-coupon bond is a debt instrument similar to loan

where the holder of the bond is entitled to a fixed series of interest payments (coupons) until the

bond matures at a specific date and the holder receives the face value (principal) of the bond.

The bond can be viewed as two investments, and discounted separately.

(4.8) PV(bond) = PV(coupon payments) + PV(principal)


The value of the bond (or a citrus investment) depends on the coupon payments (income),

the principal (value of investment), the time to maturity (expected life of the grove), and the









value of other similar bonds (opportunity cost of capital). The total number of coupon payments

throughout the time to maturity is discounted at the opportunity cost of capital, plus the final

payment of principal at maturity, is also discounted. If the sum of the present values of the

coupon payments and the principal is more than the purchase price of the bond, then the NPV is

positive. Changes in the purchase price of a bond are related to the rates of return of other assets

and perceptions of risk; however, a citrus investment does not pay a fixed income over its life

nor will return a fixed amount upon maturity. Therefore, the valuation method must include a

way for determining a grove final value.

As previously stated, the present value calculation has the property of being a geometric

series which compounds the discount rate by raising it to the power of the time period. This

makes the value of future cash flows logarithmically smaller the farther out into the future, up to

the present value of $100 at infinity which is zero.



Table 4-1. Discounting example

Discounting $100 @ 10%

Year Discounted Amount
1 90.91
2 82.64
3 75.13

15 23.94

30 5.73


The value of an infinite series of equal future cash flows, called perpetuity, is a useful way

of determining an asset of indefinite life. The formula is derived by simplifying the present

value series to:









(4.9) PV of perpetuity = Annual Cash Flow (CF)
Annual Rate of Return


An extension for a perpetuity with constant growth (g) of cash flows into infinity can be

accounted for by the Gordon Growth Model:

(4.10) PV of growing perpetuity = Annual Cash Flow (CF)
Annual Rate of Return Annual Growth Rate


Valuation of an asset with an indefinite life span is usually calculated by determining the

present values of cash flows out to a certain planning horizon, and adding the forecasted value of

the asset at the horizon, also discounted back to the present value.


PV of ongoing business as a
perpetuity at forecast horizon


(4.11)NPV= CFo + CF_ + CF2_ ...+ CFt + f Avg. Annual CF
(1+r) (1+r)2 ( +r)t Annual Rate of Return J

(l+r)t




Determining a Discount Rate for the Citrus Investment

The NPV approach is based on the use of an appropriate discount rate to adjust future cash

flows by their opportunity costs. The opportunity cost can be viewed in two ways, a firm-

specific and a generalized manner. This analysis uses the generalized case, but the appropriate

firm-specific discount rate is explained below.

The weighted average cost of capital (WACC) is defined as the opportunity cost of the

financing source for the project being evaluated. WACC is usually a firm-specific measure, and

depends on an individual project's financing mix and tax treatment. WACC consists of the two

traditional sources of financing, debt and equity, and gives the real cost of financing the given









project. The after-tax WACC adjusts the debt component for a firm's ability to deduct the cost

of debt (interest expenses) from its taxable income. WACC is usually calculated on a project

specific basis, and not firm-wide. The WACC used to discount a specific project should be

evaluated for the debt/equity financing mixed used to expand that project.


(4.12) WACC = (% of project financed by debt) (cost of debt)
+ (% of project financed by equity) (expected return on equity)

Or = rd (D/V) + re (E/V)

Where rd = cost of debt, re = required return on equity, D = amount of debt,
E = amount of equity, and V = Book Value of project


(4.13) AFTER-TAX WACC = rd(1-Tc)(D/V) + re(E/V) where T = marginal tax rate


The generalized risk adjusted discount rate is based on a study of returns to different citrus

varieties conducted by Moss, Weldon, and Muraro (1991). That study uses a capital asset pricing

model (CAPM) similar to valuing the risk of tradable securities to compare returns of different

citrus varieties to an index constructed of the returns from a weighted portfolio of all citrus

varieties. The CAPM model is based on the idea that similar factors (such as supply and

demand) affect all citrus varieties, but not to the same extent. The CAPM incorporates the risk

of a specific citrus variety compared to a diversified portfolio of all other citrus varieties to

quantify its performance in relation to other citrus investments. This share of variance a specific

variety has in common with other varieties is represented by beta (Pi) in equation 4.4. Beta is

then multiplied by the difference between returns to the citrus portfolio and a risk-free rate of

return. This captures the relationship of the risk of owning a specific variety of citrus to the

returns for all Florida citrus. For instance, if returns to growing oranges for processing increase,

prices for Hamlin, Pineapple, and Valencia oranges will all increase, but by different amounts.









This risk adjustment is added to the return on a risk-free alternative investment to arrive at the

risk adjusted discount rate (RADR). The variety specific risk adjusted discount rates used in this

analysis are shown in Table 4.2.

(4.14) Pi = Gif / C2f

Where, ci f = Covariance of citrus variety with market portfolio of all varieties
a2 = Variance of market portfolio

(4.15) Ri = Ro + Pi (Rm- Ro)

Where, Ri = Risk adjusted rate of return on citrus variety (i)
Ro = Risk-free rate of return
Rm = Return on market portfolio


Table 4-2. Risk adjusted discount rates by variety
Beta Risk Adjustment* RADR
Early/Midseason Oranges 1.3870 0.0299 0.0824
Valencia Orange 1.9017 0.0409 0.0934
Colored Grapefruit 0.8961 0.0193 0.0718
Risk adjustment is based on an average return to the market portfolio of .0743 and a risk-free rate of .0525
Source: Moss, Weldon, and Muraro (1991)


In addition to the risk adjusted discount rate, citrus investments are also subject to a

liquidity premium, and cost of money management premium. The premiums are taken from an

unpublished analysis by Ronald Muraro at IFAS-Lake Alfred CREC (Muraro 2006d). A citrus

investment is illiquid in the sense that it cannot be sold quickly without significant transaction

fees and reduction in sales price. In this case, the liquidity premium is taken as the difference

between a 90-day U.S. Treasure Bill and the 30-year Treasury Bond, 0.55% at the time of

writing. The cost for money management premium reflects the additional work and energy

required to manage agricultural investments compared to other investments. The overall

discount rates by variety used in this analysis are shown in Table 4-3.












Table 4-3. Discount rates used in citrus investment analysis
Valencia Hamlin Red
Oranges Oranges Grapefruit
Risk Adjusted
Discount Rate 9.34% 8.24% 7.18%

Add:

Liquidity Premium 0.55% 0.55% 0.55%
Difference between
3-Month Treasury
Bills and 30-Year
Bonds/January 2006

Cost of Money Management 2.00% 2.00% 2.00%
Most investments
Range from 1% to 2%;
Sometimes agriculture
is higher.


Total Discount Rate 11.89% 10.79% 9.73%
Say: 12.0% Say: 11.0% Say: 10.0%


Determining an Appropriate Terminal Value for a Citrus Investment

The value of a Florida citrus grove can best be separated into two components: the value of

the current and future income from fruit production, and the value of the underlying land. As

shown by the bond example for valuing a long-lived asset, any analysis must determine a

terminal value for all future returns to the grove after the final period of analysis. The most

realistic and accurate ending value would be the sales price of a particular grove at that future

point in time given that the sales price reflects agreement between the seller and buyer's

expectations on the future income of the grove and the underlying land value. Unfortunately,

determining the value of the underlying land depends significantly on the particular

characteristics of location, soil, demand, and highest and best use of the land that are beyond the









scope of this analysis; however, information exists about grove income and we can arrive at a

reasonable approximation of a terminal value to include in this analysis.

The valuation (or appraisal) of land and real estate property is commonly divided into three

analysis approaches that are subsequently compared to determine a fair market value for the

property (The Appraisal Institute 2001). First, the extraction or cost approach values the

replacement or reproduction cost of structures and improvements to land given that the utility of

the structures or improvements can be exactly reproduced. For agricultural properties, the cost

approach is usually not applicable because of the low percentage of the total value of the

property that is attributable to structures and improvements (Muraro 1989). Second, the income

approach values a property by its income producing potential and converts the value of all future

income accruing to ownership of the property to a present value through the capitalization rate.

This is the main approach this analysis will use. Third, the market or comparable sales approach

estimates the value of the property by observing the values of like properties, and adjusting for

particular aspects of the sale, such as location, transaction date, land characteristics, and the

terms of sale. While the comparable sales approach is only applicable to specific properties, this

analysis will use that approach to validate an applicable capitalization rate.

The income approach to citrus valuation starts by deriving an average annual expected

income from the property, net of grove and operating expenses. This is divided by the sale price

of the land to determine a capitalization (or cap) rate. The cap rate can be thought of as the

annual return on investment, and is positively related to increases in net income and negatively

related to increases in the sales price. Note, the cap rate only includes income, and not changes

in the selling price of the land over time (capital gain or loss). Since this analysis is generalized

to a variety of grove circumstances, the actual sale price of the grove is unknown, but is assumed









to be dependent on a grove's productivity and income generating capability. A dollar amount for

annual net income is endogenously generated by the model, and rearranging the capitalization

formula to equations 4.11 and 4.12, we need only to estimate a capitalization rate for citrus.

(4.16) Capitalization Rate = Average Annual Net Income
Sale Price of Grove

Where: Cap Rate T if Net Income T
Cap Rate { if Sales Price of Grove "

(4.17) Sale Price of Grove = Average Annual Net Income
Capitalization Rate


Four applicable methods exist for deriving a capitalization rate for citrus (The American

Institute of Real Estate Appraisers 1983). First, the band of investment method uses the grove's

financing mix (debt to equity ratio) and the required rate of return on both debt and equity to

arrive at a cap rate. This method is essentially identical to WACC as explained above. Second,

the debt coverage method applies a specified ratio of net operating income to annual debt service

(debt coverage ratio) which is usually twice the value of the financed portion of the purchase

price to adjust for non-payment risk. This is usually specified by a lender. Third, the yield and

change method is an ad hoc modification to the band of investment method to account for the

growth in cash flows over time as the grove reaches maturity. This method is not applicable

when valuing a fully mature grove. Finally, the built-up cap rate method compares a citrus

investment to its alternatives, and starts with a risk-free rate and adds percentage premiums for

different types of risk inherent to citrus. The first two methods depend on a specification of the

financing mix, and are therefore cannot be generalized. This analysis selects the built-up cap

rate method because it enables the comparison of citrus to other investments, and can be

generalized to diverse grove settings.









(4.18) Band of Investment
Cap Rate = % Debt Interest Rate on Debt + % Equity Required Return on
Equity

(4.19) Debt Coverage
Cap Rate = % Debt Interest Rate on Debt Debt Coverage Ratio (usually 2)

(4.20) Yield and Change
Cap Rate = Band of Investment Cap Rate + % Chg. in net income + % Chg. in cap
gain

(4.21) Built- Up
Cap Rate = Risk Free rate + Price Risk Premium + Liquidity premium + Ag. risk
premium + Management premium


The built-up cap rate method requires the estimation of the various premiums described

above. The risk-free rate of return used is the rate on a 90-day US Treasury Bill. A variety-

specific price risk premium derived from Moss et al. is added. A proxy for credit risk called risk

of ownership is added and includes the difference between low risk and medium risk investment

grade bonds plus an estimated 2% agricultural risk premium. A cost of money management is

added to account for the more intense investment management needed for a citrus investment.

The cap rates used in this analysis are shown in Table 4-4.










Table 4-4. Built-up capitalization rate method used in analysis
Valencia Hamlin
Oranges Oranges


4.54% 4.54%


Risk-Free Rate
Rate used is 3-Month
Treasury Bills/January 2006

Price Risk Premiuma/

Risk of Ownership
Difference between
average of Corporate Aaa
And Baa Bonds and the
average of 3-Month and
2-Year Treasury Bills
Plus 2% additional risk
For agricultural operation

Premium for Non-Liquidity
Difference between 3-Month
Treasury Bills and 30-Year
Bonds/January 2006

Cost of Money Management
Most investments
range from 1% to 2%;


2.99%

3.16%









0.55%





1.50%


Total Capitalization Rate 13.84% 12.74% 11.68%
Say: 13.9% Say: 12.8% Say: 11.7%

a/ "The Impact of Risk on the Discount Rate for Different Citrus Varities,"
Agribusiness, Vol. 7. No4, 327-338 (1991) (Moss, Weldon & Muraro)

The respective cap rates were then compared with comparable sales of real groves

throughout the state, and were found to be in line with expectations. Note, the comparable sales

were taken from the period 1999 to 2004 because more recent sales may show significantly

lower cap rates due to intense non-agricultural demand for citrus land within the last two years.

This was done in order to avoid distortions caused by speculative demand, and arrive at a cap

rate representative of the value of citrus land, not land for future development.


Red
Grapefruit

4.54%



1.93%

3.16%









0.55%





1.50%


4.09%

3.16%









0.55%





1.50%









Table 4-5. Comparable Florida grove sales


Year of Cap
Sale Location Description Boxes/acre Price/acre Rate
1999 Central Young/mature grove of early/mids and
Valencias 511 7,883 22%
2000 South 10yr grove of early/mids and Valencias 500 8,002 13%
2002 Southwest 12yr grove of Valencias 432 8,096 13%
2003 Central 12yr grove of Valencias 433 8,358 11%
2004 Central Mature Valencia grove 500 7,704 10%
Average: 475 8,008 14%
Source: Ronald Muraro, IFAS Extension Economist


This investment model calculates the average net income from the last two years of the

analysis, divides the average by the respective cap rate in order to determine the terminal grove

value, adds the result back into the year 15 cash flow, and discounts the amount back to the

present. The last two years of net income are taken as representative for a stable, mature grove.

In certain circumstances under high tree loss scenarios due to disease, the terminal grove value

falls below current prices for vacant (pasture) land. To correct for this impossibility, the terminal

value defaults to the current price for improved pasture land when this occurs.


Adapting NPV Analysis to the Citrus Grove

Conceptually, the mixed age tree model is based on a study done by Ronald Muraro at the

Lake Alfred CREC for citrus grove rehabilitation and two models from the forestry management

literature. Muraro (1985) applied a mixed-age grove model to compare rehabilitation of a

freeze-damaged grove with solidest replanting. This model compared costs and returns over a

10 year period incorporating different tree ages. Buongiorno and Michie (1980) developed a

matrix model of mixed-aged Northern Michigan pine trees in a linear programming model to

optimize and test selective cutting methods to maximize NPV. In the model, trees move up

diameter classes with time, tree loss due to harvesting is replaced with in-growth of new trees,









and a cutting schedule is determined that would result in a sustained yield that maximizes returns

in an NPV framework. This model was modified by Boscolo and Vincent (2000) to apply a loss

(damage) matrix accounting for young trees damage in the logging process, and tested for NPV

maximizing behaviors while overlaying different policy scenarios. The mixed-age grove model

is best conceptualized as based on a tree age matrix to describe the evolution of the starting

number of trees, the tree loss according to tree age, the resetting of dead/unproductive trees, and

the loss of reset trees according to age as the analysis moves forward through time (Figure 4.2).

For explanatory purposes, each group of trees of the same age will be referred to as a cohort.

The period of analysis is an annual time variable and increases down the columns, and tree age

increases along the rows.

AGE DISTRIBUTION MATRIX (A)



Age of Trees (a) -*


TOO 0
T11*L1
R20 T22*L2
| R31*L1 T33*L3
<-e

r. Rt,a-2*La-2 Tta*La




Where: Tta = % of original trees per acre in period(t) of age(a)
Rt,a-2 = % of reset trees per acre in period (t) of age (a-2)*
La = (1 % tree loss) for trees of age(a)
*note: resets are lagged 2 periods due to the assumption of biennial resetting.


Figure 4-2. Tree age distribution matrix









Each matrix row is a snapshot of the distribution of trees in each age group during that

period of analysis, and would sum to 1 (or 100%) if there were zero tree loss. Each cohort of

trees planted in period t move diagonally through the period of analysis. In this example, Too

represents the starting cohort of trees planted in time zero that are zero years old. As the period

of analysis advances one year, the starting cohort of trees (T) becomes one year old, and is now

represented by T11. After one year, some percentage of the T trees is expected to be lost as given

by the tree loss rate by age of tree or L1. T 1 is then multiplied by 1-L1 to appropriately reduce

the percentage of starting trees.

To incorporate the assumption of biennial resetting (replanting dead/unproductive trees

every other year), resets (Rt-2,a) are included on the matrix diagonals below the center (T)

diagonal and lagged two periods. In this example, in analysis period 2, reset trees are planted at

age 0 (R20). The resets then follow the same evolution over the analysis periods and are reduced

at the appropriate tree loss rate for their age. In the model, 100% of dead/unproductive trees are

reset at the end of each 2 year period up until year 12 when only 50% of the trees lost are reset.

Where: t = analysis period, a = tree age, s = starting tree age
T = % of original trees/acre, R = % of reset trees/acre
L = tree loss rate conditional on tree age D = Density of trees/acre
B = tree age distribution of grove
A A-2
(4.22) Ttax(l-La)xD + Z 2 Rta x (l-La)xD
a=S a=S-2
A-4
y+ 4 Rta x (l-La)x D
a=S4

...(continues)...

A 12
+ 1 12 Z Rta x (l-La)x(.5)D
a=S 12









A 14
+ Z 4 4 Rta X (1-La) x(.5)D
a=S-14

15
Y Z Bt
t=0
This is due to the opinion that higher density plantings will be maturing at around 10 years

of age, and the older original trees will shade out the young reset trees if spaced too closely

together (Muraro 2006 IV).

Calculating Yields for a Mixed-Age Grove

The per-acre yields given by a mixed age grove can be considered an extension of the age

distribution equation above. As trees age, box production per tree increases, also, pound solids

per box increase with tree age. In equation (2), an additional term for box yield per tree and

pound solid per box by tree age is added to each tree age cohort. This captures the differences in

yields between trees planted at different times. Appendix B Table B2 illustrates the yield

distribution by tree age for Valencia oranges on the Ridge.

15 A2
(4.23) 11o T Tta x (1-La) xDx YaSa + 52 Rta x (1-La) xDx YaxSa
a=O a=s-2

...(continues same as previous equation)...

= Total boxes per acret
= Total pounds-solid per acret

Where Ya is boxes per tree for a tree of age a and Sa is pound-solids per box for a tree of age a.



Determining Grove Production Costs

This analysis works with the assumption of the use of precision agriculture in grove

management, and applies the tree age matrix to adjusting costs by tree age. First, mature grove

costs for a 10+ year old grove are determined for the base and disease scenarios based on IFAS









citrus production budgets. Cost categories that vary by tree age are cultivation and herbicide,

spraying/chemicals, fertilization, pruning/topping/hedging, and irrigation. The costs are adjusted

by tree age according to the schedule in Appendix B, Table B8 Grove Cost Adjustment by Tree

Age.

Solidset grove costs for years 1 through 4 of tree age are determined separately for the base

and disease scenarios. If the grove is being solidset, the model charges planting costs for special

cultivation and herbicide applications(years 1-4), tree wrap maintenance (years 1-3), labor for

cutting sprouts (years 1-2), Ridomil/Aliete application for foot rot (years 1-2), tree cost, and one

time charges for staking, planting, tree wrap, and first watering of the tree. Spray/chemical costs

are adjusted according to the above schedule (see Appendix B, Table B3 Solidset Costs by

Disease Scenario).

Reset costs for year 1 through 3 are determined separately for the base and disease

scenarios. As stated in Chapter 1, reset trees incur supplemental costs in addition to normal

grove care costs for about the first three years of life. Supplemental reset costs include

maintenance and cultivation (for years 1-3), and one-time planting charges for site preparation,

dead/unproductive tree removal, nursery tree cost, staking, planting, and first watering the tree.

These costs are in addition to the normal costs incurred for 1 to 3 year old trees.

To incorporate changes in the grove care costs due to tree loss and resetting, a matrix

approach is used to provide a simple and dynamic method for adjusting total costs by the number

of trees of each age. A grove care budget is created for the grove adjusted by tree age from

planting to 15 years of age (see Appendix B, Table B5 New Planting/Replanting Operating

Cost Budget for Valencia Grove).









This budget is used to form a 15x1 vector for each grove cost category (for example,

cultivation of grove costs by tree age) that begins with the starting age of the original trees. The

tree age matrix of the original planted trees only (the reset trees are separated out and will be

used in the next step) is a diagonal matrix with zeros on the off-diagonals that gives the

percentage of the original trees by age and by year of analysis. The tree age matrix is multiplied

by the cost category vector to give a vector of costs adjusted to tree ages for all the periods of

analysis. For example, 90% of the original planted trees exist in year ten, and are ten years old

(Notation: T1o,1o). 90% is multiplied by the cost for cultivation and herbicide for ten-year-old

trees (Clo) which gives the total cost of cultivation and herbicide attributable to the original

planted trees in year 10. For simplicity of illustration, Figures 4.3 and 4.4 separate the original

trees from reset trees, however, in the actual calculation these two categories are combined in the

same matrix following Figure 4-3.


Original Trees Coo Wo
Too C11 Wl
T11 C22 W2
T22 X


Tta ta Wt




Where: Tta = Percent of Trees of age (a) at time (t)
Cta = Total cost per acre for tree age (a) at time (t)
Wt = Adjusted cost per acre for trees T at time (t)

Figure 4-3. Cost calculation by tree age (original trees)

Subsequently, a similar operation is used to determine the costs for reset trees, starting

with the reset trees age matrix. The diagonal of this matrix consists of zeros (the original trees

were separated and used in the previous step) and the reset trees reside in the lower triangle. Due









to the biennial resetting program assumed in this analysis, the resets are planted at two- year

intervals (every other year). For example, in year 4 of the analysis, the total number of resets

will consist of those planted in year two which are now two years old, plus new resets planted in

year 4 which are 0 years old. Therefore, the reset costs incurred in year 4 (Z4) are the percentage

of zero (R40) and two-year-old (R42) resets times the supplemental costs for zero (So) and two-

year-old (S2) resets plus the grove care costs for zero (C1) and two-year-old (C2) trees.



Reset Trees Age Matrix 0 0
0 So+ Ci Z2
R20 0 S1 + C2 Z3
0 R31 0 X S2+3 Z4
R40 0 R42 0 C3 Zs
0 R51 0 R53 0

R15,9 0 R15,11 0 R15,13 0 C15 Z15


Where, Rt,a-2 = Percent of reset trees in grove lagged two years
Sa = Supplemental reset costs for tree age 1 to 3
Ca = Total cost per acre by tree age
Zt = Adjusted cost per acre for all resets of all ages in year (t).

Figure 4-4. Reset tree age matrix

Therefore, the total operating cost per acre at analysis period t (Ct) is a combination of the

adjusted cost per acre for the original trees at period t (Wt), and the adjusted cost per acre for the

reset trees at period t (Zt). Some operating costs are fixed, and are not adjusted according to tree

age. Overhead, maintenance, and miscellaneous are fixed as a percent of mature grove costs,

while property taxes follow a fixed-rate schedule of increases as the grove matures. These fixed

costs are collected into the term (F), and are added to the adjusted costs for the original and reset

trees to form a total cash budget for the 15 year analysis (see Appendix B, Table B6 Mature

Valencia Grove Operating Cost Budget).

(4.24) Ct = Wt + Zt + Ft









Determining Cash Flows

By adjusting yields and costs to the age of the trees, this model creates a realistic portrayal

of the dynamic nature of the citrus grove. The basic operating cash in flows are constructed as a

function of analysis period (t), tree age (a), number of trees per acre (T), box yield per tree (Y),

harvest cost per box (H). Since this analysis presents both processed and fresh market varieties,

additional terms must be introduced to calculate price by market outlet, these are: pound solid

yield per box for oranges (S), the price per pound solid (Pps), the packout rate for grapefruit as a

percentage of harvested fruit saleable as fresh (K), and the price for fresh grapefruit (PF) and

processed grapefruit (Pp), since they are significantly different. Grapefruit prices do not include

harvest costs because prices are considered "on-tree" which means net of picking, roadsiding,

and hauling charges. The presence of canker is expected to reduce per tree yields; therefore a

percentage term for the yield penalty (Q) related to canker is included in the cash-in-flow

equation.

Oranges:


(4.25) CASH IN FLOW (CF+)t = YtaX(1-Q)x Sta x Ttax Ppst-Yta x(1-Q)x Ht
a=0

Grapefruit:

A
(4.26) CASH IN FLOW (CF+)t = (Yta x Tta x Ktx PFt) x (1-Q)
a=0

+ (Yta x Tta x (1-Kt) x Pp)x (l-Q)

t = analysis period a = tree age

Cash out flows are considered the same for oranges and grapefruit and are constructed as a

function of analysis period (t), tree age (a), the number of trees per acre (T), and the operating

costs per acre (C). The presence of canker or greening in the grove is expected to incur









additional costs in the term (D), which has variable and fixed components. The variable disease

costs (DV) are related to the increases in spray programs which are adjusted according to tree

age, while fixed disease costs (DF) are incurred through grove inspections and windbreaks for

fresh market grapefruit with canker.

(4.27) Dt = DVta + DF

(4.28) CASH OUT FLOW (CF-)t = Ct + Dt

The cash flow in each period is now constructed for the NPV model where the cash inflow

and cash outflows for each period are collected into cash flow one term (CF), which may be

positive or negative depending on that period's cash flows.

T T
(4.29) PV = (CF+t) + (CF-1) = CFt
t=o (1 + r)t t- (l+r)t
Adding the additional terms for the grove establishment or purchase costs (generally referred to

as the initial investment) and the terminal value completes the multiperiod NPV model. All cash

flows are considered to be end of period and are discounted from that point, however the initial

investment is the period 0 cash flow and will include grove establishment costs plus (if there are

existing trees) cash inflows and outflows related to operations in period 0. The terminal value

also includes operational cash flows in period 15 plus the terminal grove value.

T
(4.30) PV = CFo + _CFt + CFT
t=o (1+r)t (1+r)T









CHAPTER 5
EMPIRICAL RESULTS

Alternative scenarios are constructed to develop hypothetical situations currently faced

by Florida growers. First, investment scenarios are determined based on either new plantings

(with and without land costs), or mature plantings without land costs. Then, the production costs

and yields detailed in Chapter 2 are established for Hamlin and Valencia sweet oranges grown

for the processing (juice) market on both ridge and flatwoods locations, and colored (Red or

Pink) grapefruit grown for the fresh fruit market on an Indian River location. Finally,

assumptions are applied for additional costs, yield decline, and tree losses due to the different

diseases. In Appendix B, detailed cost budgets illustrate the Solidset Costs (Table B-3) of grove

care expenses for the first four years of a new Valencia planting. Appendix B tables B-15, B-16,

and B-17 show annual mature grove production costs with the canker, greening, and canker and

greening diseases scenarios, respectively. Actual production costs are reported in Appendix B

(Tables B-5 and B-6) for a Valencia ridge grove, and vary from the annual figures because of

adjustments for tree age, tree loss, and resetting.

The return on investment is determined at different price levels for citrus using a net

present value framework over a 15 year period of analysis. Price is assumed to remain constant

over the analysis period. In this respect, price serves as an indicator of the effects of changing

costs and disease scenarios. The breakeven prices reported are the lowest prices where the NPV

of the grove is positive over the 15 year period. All calculations are performed on a per-acre

basis.


Results of the Mixed-Age Grove Model Yield and Cost Analysis

For a new planting of citrus, initial planting (solidset) costs are included in grove expenses.

These costs include initial tree and planting costs, as well as the previously indicated young tree









care, but not irrigation installation and land preparation. Figure 5-1 shows the evolution of

yields and expenses for a new or replanted Valencia orange grove on the Ridge over the analysis

period, where annual box yields per acre are listed on the left axis and operating costs per acre on

the right axis. One can observe in Figure 5-1 that after the initial costs of bringing the trees into

production, costs rise as the grove matures, and then level off. The periodicity due to resetting

starts to become more apparent at tree ages ten to fifteen. It is interesting to note the periodicity

of operating costs due to a biennial resetting policy. This periodicity disappears with either an

annual or no resetting policy. It does suggest an ability to manage expenses by putting off

resetting in times of low prices or production. This periodicity would be greater with certain

blight susceptible rootstocks such as Volkameriana or Rough Lemon, where tree loss due to

blight increases after maturity. In the analysis of new plantings, yields peak at year 10 and then

decline. Further analysis reveals that the high density planting of Valencia settles into an

equilibrium of 450 to 500 boxes per acre. The yields peak at year 10 because of the initial yield

data the model is given. Trees on more slowly maturing rootstocks, such as Cleopatra Mandarin,

would be expected to peak later.

The analysis continues with projecting the expected yields and costs of a mature Valencia

grove on the ridge. Tree density on the ridge is assumed to 112 trees per acre and to start with

the tree age distribution in Table 5-1 which was endogenously derived using the analysis model

to project the ending tree age distribution (at year 15) after starting with a solidset grove,

assuming biennial resetting, and state historical tree loss rates.

As shown in Figure 5-2, production declines slightly from 290 boxes per acre to stabilize

around 275 boxes per acre. This reflects the higher loss rates among older (15+ year-old)

productive trees, but eventually settling to an equilibrium level.












Sol idset/Replanted Valencia Ridge Grove Yield/Expenses (198 trees / acre):
with no canker or greening

3,000 -- 600

2,500 500

2,000 400

; 1,500 300

,X 1,000 200

500 ------------------100

0 0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
S HarvetstCost Operating Cost Total Boxes Produced (acre)


Figure 5-1. Costs and yields for a newly planted Valencia grove on the Ridge



Table 5-1. Beginning tree age distribution for mature Valencia on the Ridge

Mature Valencia Ridge Grove (112 trees/acre spacing):


1-3 vrs 4-10yrs 11-15yrs
12 9 4
11% 8% 3%


15+ yrs
84
75%


Total # of
Bearing Trees
109


Mature Valencia Ridge Grove Yield/Expenses (112trees / acre):
with no canker or greening

2,500 290.00

S285.00

280.00

1,500 275.00 p
270.00
1,000 ---- ---- -265.00

260.00
500
255.00

0 250.00
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
SHarvestCost lllOperating Cost Total Boxes Produced


Figure 5-2. Costs and yields for a mature Valencia grove on the Ridge


Non-bearing


Number
Percent









Citrus Canker's Effects on Yield and Costs

Applying the canker disease scenario to the model results in increases in costs and

decreases in yields. Based on the initial assumptions given in Chapter 3, canker acts to simply

shift yields down and costs up. As expected, the effect is more pronounced with the level of

susceptibility. Valencia oranges show the least effect, followed by Hamlin oranges, while yield

decreases and cost increases is most pronounced for colored grapefruit. Canker's effect on a 15-

year-old colored grapefruit grove is to shift the equilibrium yields down from approximately

340-350 boxes per acre, to around 300 boxes per acre. Annual operating costs are shifted up

from approximately $1,200 per acre to $1,460 per acre.

Citrus Greening's Effects of Yield and Costs

The adverse effects of citrus greening are shared by all three varieties under study. As

shown in Figure 5-4, greening's effect on a mature Hamlin orange grove dramatically lowers

yields and increases costs. In the severe greening scenario, the increased tree loss acts to drop

mature grove yields from approximately 400 boxes per acre to the 300-350 boxes per acre range.

Annual operating costs increase from approximately $1,015 per acre to $1,275 per acre for

additional spraying, inspections, and other disease related costs. The reduction in costs

observed in Figure 5-4 is attributable to the reduction in harvesting costs due to the reduced

yields. Also observable is the higher fluctuation of costs due to increased tree loss and higher

resetting expenses.













Mature Indian River Grapefruit Grove Yield/Expenses (95 trees / acre):
comparison with/without Canker

2,000 400.00
1,800 350.00
1,600








100.00
400-- -- -
250.00

1,000 2008 2009 2010 2011 2012 2013 2014 2015 2016 2200.00017 2018 2019 2020 2021 2022





Series o Operating Cost: no canker
1600

100.00











S00 -
400
200 5000





























0 50
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
l Series3 Harv t C ni Operating Cost: no canker
Total Boxes Produced (acre): no cankeri -- Total Boxes Produced (acre): with canker


Figure 5-3. Costs and yields for mature Indian River grapefruit grove with canker


Mature Hamlin Flatwoods Grove Yield/Expenses (145 trees/ acre):
comparison with/without Severe Greening
3,000 g t s pr ae w h of te t s in b g a O f 500
450
2,500 400

350
2,000


1,500 250
2200 2
1,000 150

100
500
50
0 0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

Additional Cost: with greening Harvest Cost: no greening Operating Cost: no greening
Total Boxes Produced (acre): no greening ----- Total Boxes Produced (acre): with greening


Figure 5-4. Costs and yields for mature Hamlin flatwoods grove with greening


An interesting result is the necessity of an aggressive resetting policy in the presence of


greening. Figure 5-5 illustrates the effect with a mature Valencia grove on the ridge, the grove


shows a precipitous decline under a no resetting policy with only 44 trees per acre of the original


112 trees per acre remaining at the end of the 15 year analysis period. Biennial resetting


maintains 102 bearing trees per acre with of the trees in bearing age. On first glance, it appears










that aggressive resetting is necessary to sustain yields with a greening infection the more

aggressively a grove is reset, the more trees remain in bearing age. The results of this model

may not be validated in an actual grove situation if greening is more severe in young reset trees.

There is evidence, as shown in the Chapter 3 survey of scientific literature regarding canker and

greening, that resetting individual trees in a grove with a severe greening infection may be

unadvisable due to the behavior of the psyllid insect vector which is attracted to the growth

flushes of young immature trees.


Mature Valencia Ridge Grove Resetting Strategy Comparison (112 trees / acre):
with/without Greening

350

300

250

S200
Yield w/ resetting & no greening
150
m ----- Yield w/o resetting & no greening
100
Yield w/ resetting & greening
50
-----Yield w/o resetting & greening
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022



Figure 5-5. Resetting comparison




Investment Scenarios

New Planting Scenario represents the situation of a grower who intends to plant citrus and

must purchase land at current market prices. The land cost is assumed to be improved pasture or

cropland already zoned for agricultural use as reported in the IFAS 2005 Rural Land Value

Survey for the respective areas of the state (Reynolds 2005). This scenario attempts to gauge

investment returns for new entrants into the citrus industry or current growers looking to expand









their operations. Also, this scenario may apply to investors wishing to speculate in long-term

property appreciation while generating income from citrus.

Replanting Scenario is representative of a grower or landowner who already owns land

and intends to plant citrus. This land may be new to citrus, the grower may be replacing an

unproductive grove, or replanting a grove previously eradicated due to citrus canker. No

opportunity costs are assumed for alternative uses for the land, either agricultural or non-

agricultural. This scenario would especially apply to large citrus operations with contiguous

properties and vacant land due to canker eradication, or those wishing to plant citrus instead of

other agricultural operations (i.e., livestock, forestry, sod, etc.). Also, this scenario may apply to

investors speculating in long term appreciation in property values, and opportunities for

generating income from the land during the interim.

Mature Grove Scenario (without land costs) is based on a grower/landowner who owns a

mature (15-year-old) grove at the beginning of the planning horizon. This scenario applies to

established growers who did not suffer losses from citrus canker eradication, and seek to

examine the long-term profitability of their groves.

Mature Grove Scenario (with land costs) is based on an investor looking to purchase a

mature (15-year-old) grove. The purchase price is a set at $10,000 per acre for all varieties and

locations. It is a reasonable estimate given prices for mature orange and grapefruit groves as

reported in the 2005 Florida Land Value Survey (Reynolds 2005).










Table 5-2. Initial investment costs by scenario
Irrigation Land
Grove Scenario Location Land Cost Installation Preparation
New Plantings* Ridge 6,426 1,350 615
Flatwoods 5,895 1,000 1,422
Indian River 5,895 1,000 1,422
Replantings Ridge 1,000 615
Flatwoods 1,000 1,251
Indian River 1,000 1,251
Mature Grove Ridge -
(w/o land cost) Flatwoods
Indian River -
Mature Grove Ridge 10,000
(w/ land cost) Flatwoods 10,000
Indian River 10,000
Source: IFAS Citrus Production Budgets 2005-6

* New planting uses land cost for improved pasture land from IFAS 2005 Florida Rural Land Value Survey



Disease Assumptions

Base (No canker or greening) uses the production costs listed in Chapter 1, based on

actual costs for the 2004-05 season. Tree loss rates reflect an estimated state historical average,

excluding the effects of development and eradication. Tree loss rates for all disease scenarios are

presented in Table 5-3.

Canker-only uses Chapter 3 estimates for increased costs due to endemic citrus canker

within the state. Also following Chapter 3, a yield penalty of 10% is applied to Hamlin orange

and Red Grapefruit varieties because of their increased susceptibility, and 5% to Valencia

oranges. A slight increase in tree loss (10%) is added across the all varieties and ages.

Greening-only uses Chapter 3 estimates for increased costs due to intensive control of the

Asian citrus psyllid insect vector of greening. This incorporates additional spray costs based on

IFAS Integrated Pest Management guidelines. This analysis uses the medium rate of tree loss

due to greening.









Canker and Greening (low, medium, high) uses combined estimates for costs due to each

disease. This reflects some amount of overlap between management programs. Due to a lack of

certainty about exactly what effects Greening will have in Florida, the analysis is calculated for

three different levels (low, medium, and high) of tree loss.

Table 5-3. Tree loss percentage by scenario
TREE AGE
(in years) BASE* GREENING CANKER
Low Medium High
1-3 1.00% 2.00% 2.50% 4.00% 1.10%
4-11 1.50% 2.63% 3.00% 4.50% 1.65%
12+ 3.50% 5.25% 6.13% 8.75% 3.85%
Estimated average state historical tree loss (excluding effects of development and eradication)


Calculation of Breakeven Prices

After the operation of grove costs and yields is established in the model, price is applied as

an exogenous variable to determine the minimum price at which, for a given cost and yield

scenario, a grower or investor can expect a positive return on his or her investment. For the

purposes of this analysis breakeven prices are defined as the lowest average price over a 15 year

analysis where the NPV of the grove is positive. This is analyzed by computing the NPV for a

range of prices. The breakeven price is not a measure of year to year profitability, but of the

price level received for the grove's production where it earns in excess of its WACC or risk-

adjusted discount rate. Prices below the breakeven level signify that the grove will lose money

in real terms over the 15-year period, and prices above signify profits in real terms in excess of

the discount rate. Due to the focus on oranges for the processing market and grapefruit for the

fresh market, processed and fresh market prices are used for oranges and grapefruit, respectively.

The price used to calculate gross revenue for oranges for processing is the delivered-in price per

pound solid. Then picking, roadsiding, and hauling costs are subtracted to arrive at the net









revenue of a box of oranges delivered to a processing plant. The price used to calculate revenue

for grapefruit is a combination of the on-tree price per box for fresh and processed sales. The

"on-tree price" is the value of a box of fruit already subtracted the costs of picking, roadsiding,

and hauling. Grapefruit grown for the fresh market will have a certain number of fruit graded

unfit for fresh sale (eliminated) and sent for processing into juice instead. The percentage of the

total amount of fruit delivered to the packinghouse and sent to the fresh market is referred to as

the "packout" rate, and these receive a much higher price than fruit sent for processing. The

packout rate is assumed to be 60%. On-tree fresh prices in dollars per box are reported below,

while eliminations sent for processing receive a price of $2/box in all scenarios.


Results of the Mixed-Age Grove Model Breakeven Price Analysis

Under field conditions, citrus production is not nearly as deterministic as portrayed in this

analysis. Citrus trees are biological organisms and thus respond (sometimes unpredictably) to

changes in their environment. Climate and individual grove site characteristics have important

and widely divergent effects on production and costs. Also, there is evidence that alternate

bearing patterns exist for some varieties, and may significantly affect tree yields in a given

season. Production costs and technologies change over time and affect operating budgets.

Moreover, growers practice a range of cultural care programs, and their individual costs may be

different.

Individual growers, landowners, or investors have different asset/liability positions, tax

rates, capital gain/loss carry forwards, and risk preferences that change the dynamics and

profitability of a citrus investment. All analysis and calculations are conducted on the basis of

unleveraged cash flows before income tax in order to focus on cash flows attributable

specifically to citrus operations. Also, by excluding land value appreciation through the terminal









grove valuation method used, we attempt to remove distortions caused by recent surges in

Florida rural land values, and arrive at a true value for growing citrus in Florida.

The scenarios and assumptions presented attempt to illustrate important aspects of the

decision-making process faced by those involved in citrus production across Florida. Citrus is an

investment where a large upfront cost is incurred (buying and preparing the land and planting the

trees) with operating profits delayed several years until the trees become productive, and sunk

costs being recouped after that, all depending on volatile fruit prices. Due to the nature of

discounted cash flow analysis, changes in the upfront investment costs have a disproportionate

effect on a grove's NPV. Breakeven prices for all scenarios analyzed are summarized in Table

5-4.










Table 5-4. Estimated breakeven prices across disease scenarios, varieties, and production regions


(Price* at which NPV of grove cash flows over 15 yr period is positive)


New Plantings


Replantings


Mature Grove
(w/o land cost)


Base
Canker
Greening-low
G&C-low
G&C-med
G&C-high
Base
Canker
Greening-low
G&C-low
G&C-med
G&C-high
Base
Canker
Greening-low
G&C-low
G&C-med


RIDGE
Valencia Hamlin
$1.40 $1.30
$1.50 $1.40
$1.60 $1.50
$1.70 $1.60
$1.70 $1.70
$1.90 $1.80
$1.00 $0.90
$1.00 $1.00
$1.20 $1.10
$1.20 $1.20
$1.20 $1.20
$1.30 $1.30
$0.60 $0.60
$0.60 $0.60
$0.70 $0.70
$0.70 $0.80
$0.70 $0.80


FLATWOODS
Valencia Hamlin
$1.50 $1.40
$1.60 $1.50
$1.70 $1.60
$1.80 $1.70
$1.80 $1.80
$2.00 $1.90
$1.00 $1.00
$1.10 $1.10
$1.20 $1.10
$1.20 $1.20
$1.30 $1.30
$1.40 $1.40
$0.50 $0.50
$0.60 $0.60
$0.60 $0.60
$0.60 $0.70
$0.70 $0.70


INDIAN RIVER
GFT
$10.00
$13.00
$13.00
$15.00
$15.00
$17.00
$6.00
$8.00
$8.00
$10.00
$10.00
$11.00
$4.00
$7.00
$6.00
$8.00
$9.00


G&C-high $0.80 $0.80 $0.70 $0.70 $9.00
Mature Grove Base $1.00 $0.90 $0.90 $0.90 $11.00
(with land cost) Canker $1.10 $1.00 $1.00 $1.00 $14.00
Greening-low $1.10 $1.10 $1.10 $1.00 $13.00
G&C-low $1.20 $1.20 $1.10 $1.10 $15.00
G&C-med $1.20 $1.20 $1.10 $1.10 $15.00
G&C-high $1.30 $1.30 $1.20 $1.20 $17.00
*Price in $1P.S. for oranges, and $/on tree box (fresh) for GFT


The Effect of Agricultural Land Prices on Grove Profitability

The land prices used in the new plantings scenario are for improved pasture costing

$6,426 per acre for Central Florida ridge plantings, and $5,895 per acre for South West Florida

and Indian River flatwoods plantings. For the mature grove with land cost scenario, a price of

$10,000 per acre was applied. These prices are representative of agricultural land costs for areas

available for expansion of citrus plantings. These prices were reported as of May 2005, and may

have significantly appreciated since then, which would understate the negative effects of land









costs on new plantings. The current rural land price market in Florida constitutes a relatively

large and disproportionate upfront cost for a grower who wishes to purchase land and plant

citrus.

In reality, all citrus growers have incurred a land cost at some point, and the assumption

of zero land cost in the replanting and mature grove scenarios without land cost is not realistic.

Some portion of this land cost should be charged against the returns of a citrus investment. As in

any commercial real estate investment, many growers/landowners/investors look not only at the

income generated by the property, but also appreciation of the underlying land. Since this

analysis values only the returns associated with a citrus investment, and not land price

appreciation, these scenarios can be thought of as establishing upper and lower bounds on the

profitability of grove investment decisions facing the Florida citrus industry.

At the upper extreme, some growers/landowners/investors may evaluate a citrus grove as

an investment in isolation, and only care about the returns to the citrus operation. Therefore,

they may apply the entire land cost against the profitability of the grove. This is illustrated by

the new plantings scenario, and could represent those growers considering citrus as their primary

business. At the lower extreme, some growers/landowners/investors are purely interested in

returns from land price appreciation, and view citrus as an interim income producing activity

until they opt to realize their gains on the land. These owners would not apply any of the land

cost against the profitability of the grove, instead viewing land cost as recouped upon eventual

sale of the grove. This is illustrated by the replanting (without land cost) scenario, and could

represent investors acquiring land for future non-agricultural development. The replanting

scenario (without land cost) also includes growers who may have had sections of groves









eradicated due to canker, but do not have the ability to sell the area due to effects on their entire

grove.

The reality is that most people involved in growing citrus are somewhere in the middle;

neither charging the entire land cost against the citrus investment, nor expecting the entire return

on investment to come from land price appreciation. In weighing the results of this analysis, one

should view the breakeven prices for new planting and mature groves with land costs against

replanting and mature groves without land costs as a range between which one can expect

investment or planting of citrus. According to this analysis for a Valencia orange grove on the

ridge, even with the presence of endemic canker and a high rate of tree loss due to greening, a

citrus investment is profitable in the range of $1.30/P.S. (for replanting without land cost) to

$1.90/P.S. (for new planting with land cost). This range incorporates our conservative estimate

for the residual value of the grove as explained in Chapter 4.

The Effect of Canker on Grove Profitability

The change in costs from the base scenario is the greatest (+26% and +22%) for

new/replanting and a mature grove of grapefruit, respectively, because of significantly increased

spray and canker-free certification costs for fresh market citrus. The increase in costs for

new/replanting of Hamlin oranges (+11-13%) compared to Valencia oranges (+8-9%) reflects

Hamlin's increased susceptibility to canker and required additional sprays.

Yield penalties of 10% for Hamlin oranges and grapefruit, and 5% for Valencia oranges

were incorporated into the analysis to estimate canker's effect on per tree production, and tree

loss rates were increased 10% over the historical average across varieties to account for the

removal of infected trees. Changes in average yields due to canker are slightly higher due to the

compounded effect of the yield penalty and higher tree loss.









In this analysis, canker does not dramatically increase the breakeven prices for oranges for

processing. Although breakeven prices for new plantings are $1.50 to $1.60 per pound solid,

once land costs are excluded, breakeven prices attributable exclusively to canker increase

slightly to $1.10 per pound solid for both Hamlin and Valencia oranges. Mature plantings

without land costs continue to show profitability down to $0.60 to $0.70 per pound solid for

oranges. The effects of canker on oranges for processing, even the more susceptible Hamlin

oranges, appears to be negligible.

Replanting of grapefruit for fresh market require a breakeven price of $9.00 per box in the

presence of canker, which is historically high compared recent past non-hurricane seasons, but

appears reasonably sustainable given recent developments in grapefruit supply statewide.

Mature plantings without land cost continue to create significant cash flows even below $0.60-

$0.70 per pound solid for sweet oranges and $7.00 per box for grapefruit. A worst-case scenario

for grapefruit was performed where the packout rate was set at 40%, and this resulted in a

significant effect on profitability, with breakeven prices for worst case scenario grapefruit

increasing to $19.00-$11.00 per box for new and replanting, respectively, $19.00 and $9.00 per

box for a mature grove with and without land costs, respectively. The worst case scenario shows

the dramatic sensitivity of returns to grapefruit from changes in the packout rate.

An alternative assumption was considered with the possibility of spot picking (selective

harvesting) fresh grapefruit to raise the packout rate back to 60%. An additional $.40 per box

spot picking charge was incorporated for boxes of fresh market fruit. This additional charge

brought the breakeven price very close to the original canker scenario (with 60% packout rate),

illustrating that spot picking may be necessary to maintain grapefruit profitability in the presence

of canker.










Finally, a scenario was tested where all the costs for controlling canker are incurred, but no

yield penalty or packout loss is assumed. This is based on the idea that successful canker

management may result in no decrease in yields or packout, and applying increased costs and

decreased yields at the same time may overstate the effects of canker on an intensively managed

grove. Breakeven prices increase moderately, and show the benefit of an effective canker

management program in fresh market grapefruit.

Table 5-5. Grapefruit packout price comparison

Scenario Packout Rate Breakeven
New Plantings Base 60% $ 10.00


with Canker
with Canker (worst case)
with Canker (spot pick*)
with Canker (no yield/packout loss)
Replantings Base
with Canker
with Canker (worst case)
with Canker (spot pick)
with Canker (no yield/packout loss)
Mature Grove
(without land cost) Base
with Canker
with Canker (worst case)
with Canker (spot pick)
with Canker (no yield/packout loss)
Mature grove
(with land cost) Base
with Canker
with Canker (worst case)
with Canker (spot pick)
with Canker (no yield/packout loss)
* Spot picking assesses a $.40/box surcharge per box sold fresh


60%
40%
60%
60%
60%
60%
40%
60%
60%

60%
60%
40%
60%
60%

60%
60%
40%
60%
60%


$ 13.00
$ 19.00
$ 14.00
$ 12.00
$ 6.00
$ 8.00
$ 11.00
$ 9.00
$ 7.00

$ 4.00
$ 7.00
$ 9.00
$ 7.00
$ 6.00

$ 11.00
$ 14.00
$ 19.00
$ 14.00
$ 12.00


Further sensitivity analysis for Hamlin oranges shows that if yield loss can be controlled,

there is no movement in the breakeven price. A "no management" scenario for Hamlin oranges

assumes a yield loss of 15%, and illustrates a significant, but not immense, increase in the










breakeven price. This suggests that profitability for a Hamlin grove selling to the processing

market may not be catastrophically affected by canker.


Table 5-6. Hamlin yield-loss sensitivity

Scenario


New Plantings


Replantings


Mature Grove
(without land cost)


Mature grove
(with land cost)


Base
with Canker
with Canker (no yield loss)
with Canker (no management)
Base
with Canker
with Canker (no yield loss)
with Canker (no management)

Base
with Canker
with Canker (no yield loss)
with Canker (no management)

Base
with Canker
with Canker (no yield loss)
with Canker (no management)


Yield Loss
0%
10%
0%
15%
0%
10%
0%
15%

0%
10%
0%
15%

0%
10%
0%
15%


Breakeven
$1.40
$1.50
$1.40
$1.60
$1.00
$1.10
$1.00
$1.20

$0.50
$0.60
$0.60
$0.70

$0.90
$1.00
$0.90
$1.10


While increasing production costs and decreasing yields, especially for fresh market

grapefruit, canker in isolation appears to have a relatively small effect on the profitability of

Florida oranges for juice processing. Canker's effect on fresh market grapefruit is also

significant and bordering on catastrophic if canker reduces packout rates. It can be supposed that

if adequate control measures are taken, and canker is not allowed to firmly establish itself in a

grove, profitability will remain mostly unchanged.

Effects of Greening on Grove Profitability

In the greening-only analysis, we assume greening increases tree loss to 2% per year for

trees from 0 to 3 years of age, 2.63% for trees aged 4-11, and 5.25% for trees 12+ years. This is

compared to the historic state-wide tree loss rate of 1%, 1.5%, and 3.5%, respectively. Psyllid









control, increased resetting, and field inspections for greening result in an increase in production

costs across all varieties and grove ages. Production costs for oranges increase (+32%-35%) for

new plantings/replanting and (+25%-27%) for mature plantings. Production costs for grapefruit

increase (+27%) for new planting/replanting and (+21%) for mature plantings. The difference

between new planting/replanting and mature plantings reflect the disproportionate effect of

greening on young tree loss, and the need to incur additional reset costs. However, mature

groves suffer larger reductions in average per acre yields due to the absolute increase in the loss

of older, highly productive trees.

The presence of greening appears to have a greater effect on breakeven prices compared to

canker. Breakeven prices for new plantings move into the $1.50-$1.70 per pound solid range for

oranges, and $13.00 per box for grapefruit. Breakeven prices for replanting are $1.10-$1.20 per

pound solid for oranges, and $8.00 per box for grapefruit. Breakeven prices for mature groves

without land costs are less than $.60-$.70 per pound solid for sweet oranges and $6.00 per box

for grapefruit. This indicates that while greening by itself does boost production costs

significantly, its effect on replanting and mature groves (without land costs) given current price

levels shows that citrus remains a profitable investment.

A sensitivity analysis on tree loss rates exhibit that higher tree loss rates has a small effect

on breakeven prices. Another effect of greening is that average annual tree maintenance costs

actually decline as tree loss rates increase. This result relates to the use of precision agriculture

in which greening kills older trees and reduces the amount of materials and labor required for

their maintenance, plus harvest costs decline due to reduced yields. This trend may be an artifact

of the analysis assumptions and may not reflect actual grove circumstances. Moreover,










significant declines in fruit production due to the loss of mature, highly-producing trees more

than offset any cost savings.



Table 5-7. Tree loss comparison for a Valencia grove on the Ridge with greening
Scenario Avg. Expenses* Yield Breakeven
New Plantings Greening-Low $1,080.45 488 $1.60
Greening-Medium $1,090.11 474 $1.60
Greening-High $1,124.38 426 $1.70
Replantings Greening-Low $1,080.45 488 $1.20
Greening-Medium $1,090.11 474 $1.20
Greening-High $1,124.38 426 $1.30
Mature Grove without land cost Greening-Low $1,101.57 268 $0.70
Greening-Medium $1,090.83 258 $0.70
Greening-High $1,062.74 231 $0.80
Mature grove with land cost Greening-Low $1,101.57 268 $1.10
Greening-Medium $1,090.83 258 $1.20
Greening-High $1,062.74 231 $1.30
Avg. Expenses are annual per acre, with yrs 3-15 for new/replantings and yrs 1-15 for mature plantings

Canker and Greening Scenarios

The current reality of citrus growing in Florida appears to be that growers are challenged

with both canker and greening. The canker and greening scenarios (listed as "G&C" in Figure 5-

4) were conducted for all three greening tree loss rates plus yield losses due to canker. Costs

were adjusted to reflect a hypothetical combined management program.

In combination, canker and greening significantly boost production costs, decrease yields,

increase breakeven prices, and, therefore, reduce profitability. With even the low rate of tree

loss due to greening, breakeven prices in the new plantings scenario move to $1.60-$1.70 per

pound solid for oranges, and $15.00 per box for grapefruit. Breakeven prices for the replanting

scenario increase to $1.20 per pound solid for oranges and $10.00 per box for grapefruit. A

mature grove without land cost increases to $0.60 and $0.80 per pound solid for oranges and

$8.00 per box for grapefruit. Finally, the breakeven price for a mature grove with land cost

increases to $1.10-$1.20 per pound solid for oranges and $15.00 per box for grapefruit. These









prices are high by historical standards, and the possibility of achieving sustained prices above

$1.50 per pound solid for oranges or $10.00 per box for grapefruit is questionable. Therefore,

canker and greening act to decrease the profitability, especially of new plantings and mature

groves where land must be purchased at market prices.









CHAPTER 6
SUMMARY AND CONCLUSIONS

Given the short period that the Florida citrus industry has dealt with greening and canker, it

is too soon to conclude that the fundamental economics of growing citrus in Florida have

changed. The challenge associated with analyzing the impact of canker, greening, and increasing

rural land prices is principally the novelty of these issues to Florida growers, and a lack of

historical data regarding their effects. Any economic analysis on disease effects on grove

production must make assumptions by quantifying non-linear and highly complex biological

phenomena into monetary or production units in order to be measured. Any economic analysis

on the effects of land prices on a grove investment's profitability is inherently tied to people's

expectations of the value of future income from the land plus appreciation, where assumptions

must be made through the discount rate and exit capitalization rate. This analysis uses a NPV

framework to evaluate the profitability of a citrus investment, makes assumptions grounded in

actual historical data for production costs and yields, and then makes reasonable assumptions

about the monetary effects of these new challenges to Florida growers. The value of this

examination is to draw conclusions about the attractiveness of investing in citrus for the

"average" citrus grower/investor, and any changes that these new challenges may cause. From

the conclusions drawn about the economics of a citrus investment, we may be able to predict the

future entry and exit of investors in the Florida citrus industry given the behavior of production

costs and fruit prices. The limitation of this examination is the unique situation of each grower

and grove, which alters any conclusions made which are based on the grove production cost and

yield. In addition, the complex and untested nature of the assumptions used to quantify these

new challenges introduces uncertainty into the analysis and ultimate future of the Florida citrus

industry.









The assumptions about the consequences of a growing environment with endemic canker

and greening on grove production were made by looking at production data from other countries

and controlled scientific studies, however, the reality of what the true manifestations of these

diseases will be in the distinct ecologies of Florida and these diseases' interaction with the

infinitely complex biological environment will take time to study and predict. Overall, the

development of new production technologies, and the experimentation and adaptation by Florida

growers to the manifestations of these diseases will be the true indicator of the long-term success

of the Florida citrus industry.

In the first outbreak of canker in Florida in 1910, anecdotal accounts relate many trees

became rapidly infected and unproductive, which led to the statewide eradication of a significant

portion of Florida citrus trees. At that time groves, however, were not irrigated, fertilizer and

pesticide technology was in its infancy, and biological research into the means of infection was

rudimentary compared to today. The assumptions made about yield loss and production cost

increases are primarily drawn from Argentina's experience with canker, which is shares certain

similarities to Florida's climate and environment, but has a significantly lower overall level of

production technology. Long-term studies are needed to measure the spread and virility of

infection within different Florida grove locations and by variety, the rate of decline and potential

rehabilitation of infected trees, and best practices for disease control including sprays, tree-care,

and grove sanitary controls. These will be the determinants of the ultimate economic

consequences of growing citrus in an endemic canker environment.

Greening has devastated citrus industries in Asia and Africa, but these citrus industries

were nowhere near the sophistication of Florida growers in terms of production technology, and

had little access to the resources and scientific knowledge available to the Florida citrus industry.









Sprays and systemic insecticides aid in the control of the citrus psyllid insect vector, and there is

a mounting body of evidence that drought and disease-stressed trees are more susceptible to

infection. Most likely, this will increase the production cost of growing citrus, however, the

Florida citrus industry is already moving towards irrigation and regular spray programs for most

commercial groves, therefore the marginal increase in production cost of controlling for greening

may be lower than the approximately 30% assumed in this analysis.

Large institutions such as the University of Florida's Institute of Food and Agricultural

Sciences (IFAS), the USDA Agricultural Research Center at Ft. Pierce (USDA-ARS), the

Florida Department of Agriculture and Consumer Services (FDACS), and private industry are

investing significant effort into controlling and managing greening. The Florida citrus industry

should soon expect results from these research endeavors, including: the establishment of best

practices for greening control and management and new methods of biological/chemical control

of the psyllid vector. Since greening is fatal to citrus trees, if the spread of greening between and

inside groves cannot be controlled, this will have particularly negative effects on the citrus

investment because of the time frame necessary for the development and profitability of the

grove. If the average life expectancy for citrus trees is shortened to eight years (as was the case

in Thailand) the economics of growing citrus in Florida is impractical. Therefore, this author

recommends that future research efforts to determine the economic effect of greening must focus

on the probability of the spread of greening between groves and control of greening within a

grove. This will be the ultimate test of the assumptions used in this analysis.

The effect of land prices on grove profitability is more easily quantified because there

exists a market of agricultural land prices and historical information about the behavior of land

prices over time. Unfortunately, deriving an assumption for the average value of land and









making comparisons between citrus properties is difficult for two reasons. First, every piece of

land is unique in that it has a specific physical location which carries specific attributes such as

soil, drainage, micro-climate, and distance to packinghouses or processing plants which have a

direct impact upon the productivity and profitability of the grove. Second, land prices are

subject to people's expectations about the future economic value derived from use or ownership

of the land. Expectations about the highest and best use of many Florida citrus groves is

changing as the state becomes more urbanized, and a large demand of non-agricultural users for

citrus growing land (particularly in the central ridge and east coast production areas) is divorcing

the value of citrus land from the value of citrus production.

This analysis attempts to quantify the value of citrus land within the net present value

framework where it is assumed that the value of the land equals the present value of the

discounted cash flows plus a future sale value (terminal grove value) at the end of the projection

period. In this analysis, the terminal grove value is derived from the built-up exit capitalization

rate method which makes it a function of citrus prices, grove production, market interest rates,

the historical volatility of citrus prices, a premium for the ownership risk and additional effort

required to manage an agricultural operation, a liquidity premium, and a cost of money

management assumed for the additional financial structure required for the operation of a citrus

investment compared to other investment options (i.e. stocks, bonds, and other financial

instruments). In this formula, the one determinant more or less common to all growers is the

market interest rate. All other premiums are subjective and specific to the preferences of each

grower/investor, and therefore lead to different expectations of grove value.

The built-up exit cap method is still based on the NPV framework and therefore the

income derived from citrus growing, however, non-agricultural demand for citrus land adds an









additional appreciation to the transaction price of citrus land as the potential income from non-

agricultural uses is higher than citrus, and has the effect of lowering the exit cap rate for citrus

investments. This appreciation is highly property specific and is dependent on the grove's

potential for conversion to non-agricultural use. In this analysis, the prices derived for the citrus

exit cap rate were similar to actual market transactions from the 1999-2004 period which were

taken as a sample which excluded the effects of the strong non-agricultural demand for citrus

properties. Overall, this analysis attempts to exclude appreciation due to non-agricultural

demand, but this appreciation exists, and may be a significant component of grower/investors

subjective valuation of a citrus grove. At the time of writing, macroeconomic factors have

slowed the non-agricultural demand for citrus land, however, continued tracking of Florida

agricultural land prices, such as done through the IFAS Florida Rural Land Value Survey, is

necessary to determine whether citrus land prices will revert to being more closely correlated

with the income value of land, or a new price level is established for Florida rural land and will

persist.

In this analysis, citrus prices are treated as an exogenous variable; however, they are the

ultimate determinate of the profitability of the citrus investment. Analysis of citrus price trends

is outside the scope of this analysis, but price is the most important component of this analysis as

the effects of citrus canker, greening, and rural land prices are all compared on the basis of the

relative change in the breakeven price for the citrus investment within the NPV framework. All

results are relative to citrus prices, and the current high price environment makes the citrus

investment profitable even with significant increases in production cost, tree loss, and land

prices.









The economic model of perfect competition suggests that excess profits or losses are

transitory and with no barriers to entry or exit the marginal price of selling a good equals the

marginal cost of producing it, and the dynamics of production and competition in the Florida

citrus industry exhibit many similarities to this model. Within this model, the NPV of the citrus

investment can be considered a proxy for excess profit or losses, while the breakeven price

where the NPV equals zero can be considered an equilibrium point. If current prices are

expected to be above this breakeven price, then one can expect citrus acreage to expand until the

additional supply forces prices down to their equilibrium level, and vice versa in the case of price

expectations below the current breakeven price. In the real world, many factors conspire to

complicate and cloud this fundamental relationship, such as: imperfect information, different

subjective price expectations, different risk expectations (as transmitted through the discount

rate), different cost structures, lags in supply response, changes in demand, foreign competition,

and personal preferences.

In attempting to construct an average return to the citrus investment, we can begin to draw

conclusions about the current and future prospects for the Florida citrus industry. This analysis

finds that current price levels (as of Fall 2007) around $1.75 per pound solid, if sustained, make

many of the scenarios examined profitable, even in the presence of canker, greening, and high

land prices. The major question remaining is if the current high price environment is sustainable

and citrus has established a new higher equilibrium price. In the long run, canker, greening, and

higher citrus land prices should act to force up the cost of production, and therefore the

equilibrium price, however, more research is needed to determine whether other factors,

principally US consumer demand for citrus products and Brazilian citrus production costs will

allow the price to remain higher.









The three new challenges of canker, greening, and higher citrus land prices will bring

change to the Florida citrus industry, and change brings uncertainty. The myriad of other factors

interrelated with this uncertainty and their respective feedback loops introduce yet more

complexity into the system, and this creates a perception of greater risk in growing citrus in

Florida. The Florida citrus industry has experienced and survived other adverse situations such

as tristeza, the freezes of the 1980's, the low prices of the late 1990's, and others. With each

crisis, there were people who doubted that the industry will ever recover, however, each time it

did because Florida growers change and adapt to the new realities forced upon them. The

resilience of the industry comes from the fact that there are few places in the world where the

beneficial attributes of abundant land, climate, skilled citrus growers and researchers, financial

resources, and a stable and consistent political and legal environment have converged to such a

great extent as Florida. Once the full effects of these new challenges are felt, growing citrus in

Florida will be different, but its prospects look quite good.










APPENDIX A
GEOGRAPHIC AND TOPOGRAPHIC FEATURES OF FLORIDA COMMERCIAL CITRUS
PRODUCTION REGIONS

Florida commercial citrus production is generally divided into four major geographical

production regions with citrus grown on two topographic features (Muraro 2004). The Central

Florida citrus region includes Lake, Polk, and Highlands counties and accounts for about 25% of

Florida's total citrus acreage. The Southwest region includes Charlotte, Collier, Desoto, Glades,

Hardee, Hendry, and Lee counties with 35% of total citrus acreage. The Western region includes

Hillsborough, Manatee, Pasco, and Sarasota counties with 7% of total citrus acreage. The Indian

River region refers to the citrus producing counties on Florida's east coast including Brevard,

Indian River, Martin, Palm Beach, and St. Lucie counties with 24% of total citrus acreage (FASS

2005). The remaining citrus acreage is dispersed throughout the state with a general orientation

southwards after the disastrous freezes of 1980's destroyed much of the Northern citrus acreage.



Table A-1. Florida commercial citrus acreage, 2004-5

County Acres County Acres
Hendry 29,607 Glades 3,517
Polk 24,777 Okeechobee 3,480
Highlands 21,338 Lee 2,861
DeSoto 13,578 Pasco 2,732
Collier 10,478 Orange 1,450
Hardee 10,265 Palm Beach 752
Martin 8,348 Brevard 648
St. Lucie 6,310 Sarasota 285
Charlotte 6,119 Seminole 273
Lake 4,862 Marion 267
Manatee 4,723 Hernando 224
Indian River 4,179 Volusia 169
Hillsborough 3,939 Other 1 92
Osceola 3,777 Total 21 169,050

"Alachua, Citrus, Pinellas, and Putnam counties
Source: 2004-05 FASS Citrus Summary


































Figure A-1. Florida commercial citrus acreage map, 2005

The "Ridge" topography refers to the well-drained sandy soils (entisols) concentrated in

the Central Florida region although the ridge also extends into the Western zone. These soils

allow a deep extension of the citrus tree's root zone, and trees tend to be large and productive

due to the access to nutrients that the large root spread provides. The "flatwoods" topography

refers to low-lying, poorly-drained soils (alfasols and spodosols) where citrus must be planted on

raised furrows to allow for sufficient rooting depth. The Western, Southwest, and Indian River

areas are predominantly of the flatwoods-type, but flatwoods groves exist in low lying regions of

Central Florida as well. Flatwoods groves tend to grow smaller trees due to the shallower root

zone, however, the Indian River region is known for its high quality grapefruit groves which

thrive in the poorly drained alfisols of the eastern coast of Florida (Obreza and Collins 2002).



























Source: Obreza and Collins 2002
Figure A-2. Florida citrus soil types



FLATWOODS GROVE DESIGN


Double-Row Bed


-I..


Srr_ Drainage
--. Pipe


Single-Row Bed


-I


'Oki"
WAT E. E. .
:.-.'.... WATER TABLE .- ,
*- --. ..-r


HARDPAN 7 -



Figure A-3. Illustration of flatwoods grove design


------------c-- --------- ~~---- ~.









Many flatwoods groves have a "hardpan" of an impermeable layer of clay at 20 to 48

inches of depth that does not allow for drainage of the water table, especially during periods of

high rain during the summer. Citrus trees will die if their roots are submerged in water for

extended periods of time. The poorly-drained flatwoods land requires the construction of beds

(artificially raised rows of soil) where citrus trees may be planted so as to allow for sufficient

rooting depth. Commonly, these are double-row beds that transport water away from the root

zone through a network of furrows, drainage pipes, ditches, pumps, and retention ponds.

Flatwoods groves incur higher land preparation costs compared to Ridge groves, as shown

in Table A-2. Changes to grove architecture and/or tree density require incurring costs for soil

preparation and bed construction all over again. Therefore, this analysis assumes that new

planting and replanting of citrus will incur the same land preparation costs.

Due to the excess space required by drainage management in the flatwoods, there are

correspondingly fewer trees per acre of land area in the flatwoods than on the ridge, as reported

in Table A-3. This analysis assumes, however, that new flatwoods and ridge groves will have

the same high density tree spacing. In order to make production costs and yields comparable,

this analysis reports its results per planted acre of citrus. This becomes important when land

prices are factored in because prices are per acre. Land price is adjusted by dividing it by the

percentage utilization in citrus, assumed to be 95% for ridge groves and 75% for the flatwoods.

This converts the land price into per acre of planted citrus terms.










Table A-2. Average citrus land preparation costs, 2002-03 season


Land Clearing (pasture)
Laser Leveling
Bedding: 2-row
Soil Amendment: Dolomite (1 ton)
Soil Amendment: Super K (4001bs)
Canals, Ditches, Dykes
Reservoirs and Roads
Throw-out pumps
Culverts
Middle Drop Drainage
Drainage Tiles
Soil Fumigation
Cover Crop

Total:


FLATWOODS
195
275
130
35
30
195
155
55
85
105
150
n/a
12


$ 1,422


Source: Muraro 2004


Table A-3. Land utilization of Florida citrus groves
Ridge Flatwoods
Range Average Range Average
Planted in Citrus 90-97% 95% 55-85% 71%
Roads and Service Areas 3-10% 5% 3-15% 6%
Canals and Ditches 0 0 5-10% 8%
Water Retention 0 0 10-30% 15%
Source: Muraro 2004


RIDGE
350
n/a
n/a
35
30
n/a
n/a
n/a
n/a
n/a
n/a
330
12


$ 757









APPENDIX B
PARAMETERS USED IN THE ANALYSIS

In this appendix, input data used in the grove investment analysis is presented. This

includes establishment cost for new plantings, reset costs, grove maintenance costs for both a

newly established and mature grove. This data is presented in Tables B-l through B-4









Table B-1. Solidset costs by disease scenario for a Valencia orange grove in the ridge
Valencia Ridge Grove w/ No
General Grove Information: Canker or Greening Valencia Ridge Grove w/ Canker Valencia Ridge Grove w/ Greening


Solidset Planted Trees (cost /
acre) Year 1 Year 2 Year 3 Year 4 Year 1 Year 2 Year 3 Year 4 Year 1 Year 2 Year 3 Year 4
Irrigation 83.09 91.39 99.70 108.01 83.09 91.39 99.70 108.01 83.09 91.39 99.70 108.01
Fertilizer 102.39 112.62 122.86 133.10 102.39 112.62 122.86 133.10 102.39 112.62 122.86 133.10
Fertilizer Through Irrigation 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Spraying 66.12 72.73 79.34 85.96 76.60 84.26 91.92 99.58 167.78 184.55 201.33 218.11
Tree Wrap 50.00 0.00 0.00 0.00 50.00 0.00 0.00 0.00 50.00 0.00 0.00 0.00
Tree Wrap (annual
maintenance) 37.50 37.50 37.50 0.00 37.50 37.50 37.50 0.00 37.50 37.50 37.50 0.00
Sprouting (labor) 30.00 30.00 0.00 0.00 30.00 30.00 0.00 0.00 30.00 30.00 0.00 0.00
Cultivation/Mowing 79.60 79.50 95.40 95.40 79.60 79.50 95.40 95.40 79.60 79.50 95.40 95.40
Herbicide 67.50 67.50 75.00 82.50 67.50 67.50 75.00 82.50 67.50 67.50 75.00 82.50
Ridomil/Aliette 52.50 52.50 0.00 0.00 52.50 52.50 0.00 0.00 52.50 52.50 0.00 0.00
Tree Cost (bare root) 1,485.00 0.00 0.00 0.00 1,485.00 0.00 0.00 0.00 1,485.00 0.00 0.00 0.00
Stake, Plant, and Water Tree 261.36 0.00 0.00 0.00 261.36 0.00 0.00 0.00 261.36 0.00 0.00 0.00
Cold Protection 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Disease-Related Costs (due to
Canker and Greening) 0.00 0.00 0.00 0.00 45.24 45.24 45.24 45.24 62.76 62.76 62.76 62.76
Miscellaneous 10.37 10.87 10.20 10.10 11.49 12.01 11.35 11.28 13.66 14.37 13.89 14.00
Supervision and Overhead 26.45 27.73 26.00 25.75 29.29 30.63 28.95 28.76 34.84 36.63 35.42 35.69
Total: 2,351.88 582.36 546.00 540.82 2,411.55 643.15 607.92 603.86 2,527.96 769.33 743.87 749.57











Table B-2. Reset costs by disease scenario for a Valencia located in the ridge
Without Citrus Canker or
Greening With Citrus Canker Wit


Supplemental Maintenance
Costs
Site Preparation

Tree Cost (bare root)

Stake, Plant, and Water Tree
Tree Removal Cost
Other Costs


Year 1 Year 2 Year 3


h Citrus Greening


Year Year2 Year3 Yearl Year2 Year3


With Citrus Canker&
Greening
Year 1 Year 2 Year 3


3.59 2.96 2.34 4.85 4.71 4.63 4.83 4.69 4.6 5.67 6.24 7.07
4.18 0 0 4.18 0 0 4.18 0 0 4.18 0 0

7.5 0 0 7.5 0 0 7.5 0 0 7.5 0 0

2.55 0 0 2.55 0 0 2.55 0 0 2.55 0 0
4.45 0 0 4.45 0 0 4.45 0 0 4.45 0 0
0 0 0 0 0 0 0 0 0 0 0 0


TOTAL: 22.27


2.96 2.34 23.53 4.71 4.63 23.51


4.69 4.6 24.35 6.24 7.07










Table B-3. New planting/replanting operating costs for a Valencia grove (without canker or greening)


Grove Care Costs
Cultivation and
Herbicide
Spraying
Fertilization
Pruning/Hedging
Irrigation
Heating/Cold
Protection Costs
Disease-Related
Costs
Other Costs
Miscellaneous
Supervision and
Overhead
Total Grove Care


Planting Costs:
Solidset
Reset/Rehab. Tree
Removal
Total Planting


0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15


0.00 177.10 177.00 170.40 177.90 132.42 141.88 151.34 160.79 170.25 189.17
0.00 118.62 125.23 79.34 85.96 92.57 99.18 105.79 112.40 119.02 132.24
0.00 102.39 112.62 122.86 133.10 143.34 153.58 163.82 174.05 184.29 204.77
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 204.77 204.77 204.77
0.00 83.09 91.39 99.70 108.01 116.32 124.63 132.94 141.24 149.55 166.17


0.00 0.00 0.00 0.00


0.00 0.00


0.00 0.00 0.00


0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 10.37 10.87 10.20 10.10 9.69 10.39 11.08 15.87

0.00 26.45 27.73 26.00 25.75 24.72 26.48 28.25 40.46


189.17
132.24
204.77
204.77
166.17


189.17
132.24
204.77
204.77
166.17


189.17 189.17 189.17
132.24 132.24 132.24
204.77 204.77 204.77
204.77 204.77 204.77
166.17 166.17 166.17


0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00
16.56 17.94 17.94 17.94 17.94 17.94 17.94

2.22 45.75 45.75 45.75 45.75 45.75 45.75


960.82 960.82 960.82 960.82 960.82


0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00


0.00 0.00 0.00 0.00 0.00 0.00


0.00 1,833.86 37.50 37.50

0.00 0.00 0.00 0.00


0.00 0.00

0.00 0.00


0.00 0.00 0.00

0.00 0.00 0.00


Costs: 0.00 1,833.86 37.50 37.50 0.00 0.00 0.00 0.00 0.00 0.00


Property Taxes 30.00 30.75 31.52 32.31 33.11 33.94 34.79 35.66 36.55 37.47 38.40 39.36 40.35 41.36 42.39 43.45
Interest on Operating
Expenses 0.90 71.48 18.42 17.35 17.22 16.59 17.73 18.87 26.58 27.72 29.98 30.01 30.03 30.07 30.10 30.13
Total Operating
Costs (Acre): 30.90 2,454.11 632.29 595.66 591.15 569.59 608.65 647.73 912.73 951.85 1,029.19 1,030.18 1,031.20 1,032.24 1,033.30 1,034.39


Costs: 0.00 518.02 544.86 508.50 540.82 519.05 556.13 593.21 849.59 886.66 960.82











Table B-4. Operating costs for a mature (15+ year old)Valencia grove located on the ridge (without canker or greening)


Grove Care Costs: 2006 2007 2008 2009
Cultivation and Herbicide 189.17 182.55 176.16 169.99
Spraying 132.24 127.61 123.15 118.84
Fertilization 204.77 197.60 190.69 184.01
Hedging 204.77 197.60 190.69 184.01


Irrigation
Heating Costs/Cold
Protection
Disease-related Costs
Other Costs
Miscellaneous
Supervision and
Overhead
Grove Care Costs
(original trees):
Planting Costs:
Solidset
Reset Tree Costs
Planting Costs
(Reset trees):
Property Taxes
Interest on Operating
Expenses
Total Operating Costs
(Acre):


166.17 160.35 154.74 149.33


0.00 0.00
0.00 0.00
0.00 0.00


0.00 0.00
0.00 0.00
0.00 0.00


17.94 17.31 16.71 16.12


2010 2011
164.04 158.30
114.68 110.66
177.57 171.36
177.57 171.36
144.10 139.06

0.00 0.00
0.00 0.00
0.00 0.00
15.56 15.01


2012 2013
152.76 147.42
106.79 103.05
165.36 159.57
165.36 159.57
134.19 129.49

0.00 0.00
0.00 0.00
0.00 0.00
14.49 13.98


2014 2015 2016 2017 2018 2019 2020 2021
142.26 137.28 132.47 127.84 123.36 119.04 114.88 110.86
99.44 95.96 92.61 89.36 86.24 83.22 80.31 77.49
153.99 148.60 143.40 138.38 133.53 128.86 124.35 120.00
153.99 148.60 143.40 138.38 133.53 128.86 124.35 120.00
124.96 120.59 116.37 112.29 108.36 104.57 100.91 97.38


0.00 0.00
0.00 0.00
0.00 0.00
13.49 13.02


0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00
12.56 12.12 11.70 11.29


0.00 0.00
0.00 0.00
0.00 0.00
10.90 10.51


45.75 44.15 42.61 41.12 39.68 38.29 36.95 35.65 34.41 33.20 32.04 30.92 29.84 28.79 27.78 26.81

960.82 927.19 894.74 863.42 833.20 804.04 775.90 748.74 722.53 697.25 672.84 649.29 626.57 604.64 583.48 563.05


0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 229.74 30.23 242.17 62.69 267.22 93.41 292.37 126.64 333.86 175.43 285.08 211.54 368.05 248.59

0.00 0.00 229.74 30.23 242.17 62.69 267.22 93.41 292.37 126.64 333.86 175.43 285.08 211.54 368.05 248.59
30.00 30.75 31.52 32.31 33.11 33.94 34.79 35.66 36.55 37.47 38.40 39.36 40.35 41.36 42.39 43.45

0.90 28.74 34.68 27.78 33.25 27.02 32.34 26.33 31.54 25.84 31.35 25.92 28.56 25.73 29.82 25.65


991.72 986.68 1,190.68 953.74


1,141.74 927.69 1,110.25 904.14 1,083.00 887.20 1,076.46 890.01 980.56 883.26 1,023.73 880.75


The costs for original trees are shown under "Grove Care Costs (original trees)" and costs for resetting an maintaining reset trees


is shown under "Planting Costs (Reset Trees)".











Table B-5. Harvest and other per box costs
Picking & Roadsiding
Transportation to processing plant
DOC box assessment
Additional Cost for Fresh Market/Spot Picking:


$1.64
0.47
0.185
1.50
Total Processed Market Cost $2.30
Total Fresh Market Cost $3.80


Table B-6. Adjustment factors for grove care cost by tree age


Grove Care Cost Category


Cost Age of
Adjustment Trees in
(Yes/No) Analysis


COST
ADJUSTMENT
PERCENTAGE
as % of
Mature Grove
Costs


Cultivation and Herbicide
Spray/Chemical Costs
Fertilization
Pruning/Hedging
Irrigation and Ditch Maintenance
Heating Cost for Cold Protection:
Disease-Related Costs due to Canker/Greening
Other Costs
Supervision and Overhead
Miscellaneous


Yes 1 50%
Yes 2 55%
Yes 3 60%
Yes 4 65%
Yes 5 70%
Yes 6 75%
Yes 7 80%
Yes 8 85%
No 9 90%
No 10 100%
11 100%
12 100%
13 100%
14 100%
15+ 100%


109










Table B-7. Annual irrigation expense (ridge/flatwoods comparison)


Variable Operating Expense (Diesel)
Annual Maintenance
Fixed-Depreciation Expense (non-cash)


"Ridge" Total:


(Additional for Flatwoods)


Clean Ditches (Weed Control)
Ditch and Canal Maintenance
Water Control (Pump water
in/out of Ditches and Canals)


"Flatwoods" and "Indian River" Total:


Source: 2004-5 IFAS Citrus Production Budgets


Table B-8. Average per acre citrus land preparation costs (ridge/flatwoods comparison)
FLATWOODS RIDGE
Land Clearing (pasture) 195 350
Laser Leveling 275 n/a
Bedding: 2-row 130 n/a
Soil Amendment: Dolomite (1 ton) 35 35
Soil Amendment: Super K (4001bs) 30 30
Canals, Ditches, Dykes 195 n/a
Reservoirs and Roads 155 n/a
Throw-out pumps 55 n/a
Culverts 85 n/a
Middle Drop Drainage 105 n/a
Drainage Tiles 150 n/a
Soil Fumigation n/a 330
Cover Crop 12 12


Total:
Source: 2004-5 IFAS Citrus Production Budgets


1,422


Table B-9. Property tax levy for top five citrus producing counties, 2003

County Millage Rate A.P.R. (%)*
Polk 17.322 1.73%
Hendry 21.062 2.11%
St. Lucie 20.855 2.09%
Highlands 18.477 1.85%
*A.P.R. is annual percentage rate of the millage rate converted into a percent
source: Hodges et al. 2003


110


($/Acre)
59.44
50.17
56.56
166.17


14.19
15.06

13.21

208.63










Table B-10. Property tax analysis assumptions


Mature Grove New Planting/Replanting
Market Value* $ 5,721.00 $ 2,934.00
Assessment Value ($/acre) $ 3,600.00 $ 1,550.00
Millage Rate ($/$1000 of value) 19.5 19.5
Effective A.P.R.(%) 1.95% 1.95%
Annual Property Tax ($/acre) $ 70.20 $ 30.23
Market value is 2003 value for Central Florida mature oranges and improved pasture for new/replanting
Source: Hodges et al. (2003) and 2003 IFAS Florida Rural Land Value Survey


Table B-11. USDA average yields by variety and production district, 1999-2004 average

VALENCIA ORANGES


Indian River
North&Central
Western
Southern
Statewide


3-5 Years
0.8
1.03
1.5
0.94
1.09


EARLY/MIDSEASON ORANGES
3-5 Years
Indian River 0.65
North&Central 1.36
Western 1.27
Southern 1.14
Statewide 1.16

COLORED GRAPEFRUIT
3-5 Years
Indian River 1.41
North&Central 2.67
Western 2.43
Southern 2.96
Statewide 1.86
Source: 2003-4 Florida Citrus Summary


6-8 Years
1.3
1.72
2.22
1.67
1.73


6-8 Years
1.51
2.3
1.74
1.9
1.96


6-8 Years
2.18
3.2
1.64
4.1
2.8


9-13 Years
1.75
2.45
2.89
2.1
2.28


9-13 Years
1.87
3.46
3.33
2.82
3.1


9-13 Years
3.14
4.68
4.27
4.11
3.62


14-23 Years
2.03
3.59
3.28
2.45
2.83


14-23 Years
2.49
4.75
4.58
3.62
4.13


14-23 Years
4.37
7.35
2.68
4.72
4.58


24+ Years
2.68
5.67
4.26
4.07
4.33


24+ Years
3.03
6.4
5.32
4.11
4.94


24+ Years
5.01
8.36
7.18
5.67
5.24










Table B-12. Rootstock study for Valencia oranges on ridge and flatwoods sites


AVON PARK (145 Trees/Acre)


SINGLE
TREE
SEASON AGE Box/Tree P.S./Box
1980/81 1 0.00 0.00
1981/82 2 0.00 0.00
1982/83 3 0.24 6.56
1983/84 4 0.97 4.96
1984/85 5 1.04 5.92
1985/86 6 1.36 6.04
1986/87 7 1.58 6.14
1987/88 8 1.69 6.26
1988/89 9 3.25 5.98
1989/90 10 2.67 6.51
1990/91 11 4.06 6.54
1991/92 12 3.89 6.59
1992/93 13 3.75 6.56
1993/94 14 4.01 7.65
1994/95 15 3.91 7.18
Source: Dr. William Castle, IFAS Lake Alfred CREC


CARRIZO


Box/Tree P.S./Box


0.00
0.00
0.26
1.26
1.57
1.85
2.93
1.95
5.62
2.98
6.00
4.59
5.65
7.22
6.53


0.00
0.00
6.57
4.81
5.82
5.70
6.22
6.22
5.89
6.06
6.44
6.30
6.37
6.92
6.78


INDIANTOWN (102 Trees/Acre)


SINGLE


CARRIZO


Box/Tree P.S./Box Box/Tree P.S./Box


0.00
0.00
0.00
0.20
0.40
1.00
1.60
2.20
3.60
2.10
3.00
2.30
4.50
4.70
3.00


0.00
0.00
0.00
5.03
5.03
5.03
7.68
6.89
5.94
7.05
7.15
7.65
6.94
7.01
6.77


0.00
0.00
0.00
0.30
0.80
1.70
2.20
3.00
4.60
4.00
4.60
4.00
6.70
6.40
5.30


0.00
0.00
0.00
4.63
4.63
4.63
8.04
6.75
6.21
7.30
7.60
7.45
6.69
7.08
6.91


Table B-13. Fruit and juice yield by variety used in the analysis


Hamlin Orange
22'x 10'
198


Boxes
Per Tree


0.00
0.00
0.55
0.91
1.28
1.73
2.19
2.55
2.92
3.28
3.61
3.61
3.61
3.61
3.61


P.S.
Per Tree


0.00
0.00
5.00
5.25
5.50
6.00
6.25
6.25
6.25
6.25
6.25
6.25
6.25
6.25
6.25


Colored
Valencia Orange Grapefruit
22'x 10' 25'x 13'
198 134
Boxes P.S. Boxes
Per Tree Per Tree Per Tree


0.00
0.00
0.46
0.77
1.08
1.47
1.85
2.16
2.47
2.78
3.06
3.06
3.06
3.06
3.06


0.00
0.00
5.00
5.50
6.00
6.50
7.00
7.00
7.00
7.00
7.00
7.00
7.00
7.00
7.00


0.00
0.00
0.68
1.14
1.60
2.17
2.73
3.19
3.65
4.10
4.51
4.51
4.51
4.51
4.51


Spacing:
Trees/Acre:
Tree
Age

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15









Table B-14. Mature grove production costs with canker by production region


Cultivation and Herbicide
Spray Program
Fertilization
Pruning
Irrigation and Ditch Maintenance
Miscellaneous
Supervision and Overhead
Water-drainage Tax
Total Grove Care (before canker)

Additional Disease Related Costs
Canker Field Inspections
Additional Spray Program
Citrus Canker Decontamination Costs


Yearly Cost to Establish &
Maintenance for Windbreak


DPI Fresh Market Citrus Certification
Costs*
Additional Packhouse Certification
Costs*
Additional Supervision/Misc. Costs


RIDGE
VALENCIA
189.17
132.24
204.77
40.06
166.17
14.65
36.62

783.68


17.52
20.96
27.72


Total Grove Care (after greening) 854.51 893.20
% Change from Base 9% 14%
* Only incurred for fresh market fruit once trees reach commerical production age


FLATWOODS


HAMLIN
189.17
132.24
204.77
40.06
166.17
14.65
36.62

783.68


17.52
57.12
27.72


HAMLIN
189.17
141.19
204.77
40.06
208.63
15.68
39.19

838.69


VALENCIA
189.17
141.19
204.77
40.06
208.63
15.68
39.19

838.69


17.52
12.01
27.72


GFT
189.17
383.17
157.00
52.13
208.63
19.80
49.51
60.00
1,119.41


17.52
48.17
27.72


4.63


17.52
35.26
27.72

11.47


60.00

40.50

13.47


4.01


6.54


899.94
7%


938.64
12%


1,325.35
18%









Table B-15. Mature grove production costs with greening by production region


Cultivation and Herbicide
Spray Program
Fertilization
Pruning
Irrigation and Ditch Maintenance
Miscellaneous
Supervision and Overhead
Water-drainage Tax
Total Grove Care (before greening)

Additional Disease Related Costs
Greening Field Inspections
Additional Spray Program
Additional Supervision/Misc. Costs

Total Grove Care (after greening)
% Change from Base


RIDGE
VALENCIA
189.17
132.24
204.77
40.06
166.17
14.65
36.62

783.68


35.04
203.31
16.68

1,038.71
33%


FLATWOODS


HAMLIN
189.17
132.24
204.77
40.06
166.17
14.65
36.62

783.68


35.04
203.31
16.68


1,038.71
33%


VALENCIA
189.17
141.19
204.77
40.06
208.63
15.68
39.19

838.69


35.04
194.36
16.06


1,084.15
29%


HAMLIN
189.17
141.19
204.77
40.06
208.63
15.68
39.19

838.69


35.04
194.36
16.06


1,084.15
29%


GFT
189.17
383.17
157.00
52.13
208.63
19.80
49.51
60.00
1,119.41


35.04
156.74
13.42


1,324.61
18%









Table B-16. Mature grove production costs with canker and greening


RIDGE FLATWOODS
VALENCIA HAMLIN VALENCIA HAMLIN GFT
Cultivation and Herbicide 189.17 189.17 189.17 189.17 189.17
Spray Program 132.24 132.24 141.19 141.19 383.17
Fertilization 204.77 204.77 204.77 204.77 157.00
Pruning 40.06 40.06 40.06 40.06 52.13
Irrigation and Ditch Maintenance 166.17 166.17 208.63 208.63 208.63
Miscellaneous 14.65 14.65 15.68 15.68 19.80
Supervision and Overhead 36.62 36.62 39.19 39.19 49.51
Water-drainage Tax -- 60.00
Total Grove Care 783.68 783.68 838.69 838.69 1,119.41
(before canker & greening)


Additional Disease Related Costs
Canker/Greening Field Inspections 35.04 35.04 35.04 35.04 35.04
Additional Spray Program 203.31 203.31 194.36 194.36 156.74
Citrus Canker Decontamination Costs 27.72 27.72 27.72 27.72 27.72

Yearly Cost to Establish & 11.47
Maintenance for Windbreak
DPI Fresh Market Citrus Certification 60.00
Costs*
Additional Packhouse Certification -- 40.50
Costs*
Additional Supervision/Misc. Costs 18.62 18.62 18.00 18.00 23.20

Total Grove Care (after greening) 1,068.37 1,068.37 1,113.81 1,113.81 1,474.08
% Change from Base 36% 36% 33% 33% 32%
* Only incurred for fresh market fruit once trees reach commercial production age









Table B-17. Spray schedule and costs by variety and disease scenario
Base


Type/Purpose
Winter-Early Spring
Systemic Insecticide (Temik/Admire)
Psyllid control
Spring-Post Bloom (at first flush)
Oil/Copper
Rust mite/Leafminer/Fungicide
Spring-Post Bloom (3-weeks after petal fall)
Copper/Micronutrients/Lorsban
Leafminer/Rust mite/ Scale
Spring-Post Bloom (6-weeks after petal fall)
Copper/Micromite
Scab/Melanose/Rust mite
Summer (late May)
Oil/Miticide
Rust mite/Scale
Summer (late May/early June)
Copper/Oil/Miticide
Rust mite/Scale/Fungicide
Summer (early July/ mid August)
Oil/Copper/Lorsban/Micronut.
Rust mite/Scale/Fungicide/Psyllid
Fall (mid November)
Vendex or Danitol
Rust mite/psyllid control


TOTAL ($/acre)


Canker


Oranges* GFT Valencia Hamlin GFT


99.58


83.43 37.86


37.86


96.6


53.63 53.82






57.46



137.06383.18


36.16 36.16


54.5 54.5 54.5


59.06


109.14


49.35 49.35 49.35


49.35 49.35 49.35


60.87



153.20 189.36418.43


Greening


Oranges*
118.63


Canker & Greening


GFT Valencia Hamlin
118.63 118.63 118.63


36.16


54.5


59.06


109.14


49.35 49.35


70.69 70.69


42.38 42.38



335.55 539.91


* Oranges not separated by variety because of identical spray programs. All orange costs representative of ridge
source: IFAS 2004-5 Citrus Production Budgets adjusted by Ronald Muraro for recommended spray programs by disease


GFT
118.63


36.16 36.16


54.5


54.5


54.5


59.06


109.14


49.35 49.35 49.35


70.69 70.69 70.69


42.38 42.38 42.38



335.55 371.71 539.91









APPENDIX C
SELECTED RESULTS



Results from various scenarios are shown in Tables C-1 through C-6.










Table C-1. Tree age distribution of a solidset Valencia grove, base scenario


Age of Original Planted Trees
PERIOD 0 1 2 3 4 5 6


1.000
0.000
0.020
0.000
0.025
0.000
0.029
0.000
0.029
0.000
0.015
0.000
0.039
0.000
0.050


0.990
0.000
0.020
0.000
0.025
0.000
0.029
0.000
0.029
0.000
0.015
0.000
0.038
0.000


0.980
0.000
0.020
0.000
0.024
0.000
0.029
0.000
0.029
0.000
0.014
0.000
0.038


0.970
0.000
0.019
0.000
0.024
0.000
0.029
0.000
0.028
0.000
0.014
0.000


0.956
0.000
0.019
0.000
0.024
0.000
0.028
0.000
0.028
0.000
0.014


0.941
0.000
0.019
0.000
0.023
0.000
0.028
0.000
0.028
0.000


7 8 9 10 11 12 13 14 15


0.927
0.000
0.018
0.000
0.023
0.000
0.027
0.000
0.027


0.913
0.000
0.018
0.000
0.023
0.000
0.027
0.000


0.900
0.000
0.018
0.000
0.022
0.000
0.026


0.886
0.000
0.018
0.000
0.022
0.000


0.873
0.000 0.842
0.017 0.000 0.813
0.000 0.017 0.000 0.784
0.022 0.000 0.016 0.000 0.757


Example: In year 7 of the analysis, 92.7% of the 7 year-old originally planted trees remain. Additionally, 1.9% of 5-year-old

reset trees remain, plus 3-year-old and 1-year-old reset trees, with 2.5% and 2.9% remaining, respectively.











Table C-2. Yields for a solidset Valencia grove- base scenario
Age of Original Planted Trees


PERIOD


1 2 3 4 5 6 7


Boxes/Age
0.00
0.00
0.00
0.46
0.77
1.08
1.47
1.85
2.16
2.47
2.78
3.06
3.06
3.06
3.06
3.06


Total Pound
8 9 10 11 12 13 14 15 Boxes Solids
0 0.00
0 0.00


340
0.0 391
6.8 0.0 440
0.0 7.8 0.0 488
8.4 0.0 8.8 0.0 529
0.0 9.7 0.0 9.7 0.0 510
10.0 0.0 10.9 0.0 10.5 0.0 492
0.0 11.5 0.0 12.1 0.0 10.2 0.0 475
10.0 0.0 13.0 0.0 13.1 0.0 9.8 0 459


0 0.00
89 446.34
148 813.62
206 1236.92
277 1800.18
346 2421.59
400 2798.23
454 3181.09
507 3546.90
554 3880.25
542 3794.99
531 3718.47
519 3634.40
511 3576.40


Example: In year 7 of the analysis, the originally planted trees are seven years old, and produce 1.85 boxes per tree totaling 340 boxes.

Additionally, there are 5 year-old reset trees producing 1.08 boxes/tree totaling 4.1 boxes, and 3 year-old resets producing .46 boxes

per tree totaling 2.2 boxes. The total production for year 7 is 346 boxes per acre, or 2422 pound solids per acre.


0.0 204
2.9 0.0 274
0.0 4.1 0.0
3.7 0.0 5.5
0.0 5.1 0.0
4.4 0.0 6.8
0.0 6.0 0.0
4.3 0.0 8.1
0.0 6.0 0.0
2.2 0.0 8.0
0.0 3.0 0.0










Table C-3. Reset strategy beginning/ending tree distributions under disease scenarios


Mature Grove Beginning Tree Age Distribution
-Valencia on Ridge


Number
Percent


Non-
bearingl
Empty
Spaces


4-
1-3 10yr
yrs s


3 12
3% 11%


11-
15yr
s


Total #
of
15+ Bearing
yrs Trees


4 84
3% 75%


Mature Grove Ending Tree Age Distribution -
Valencia on Ridge
With resetting & without greening


Number
Percent
Without resetting & without greening

Number
Percent
With resetting & with greening

Number
Percent
Without resetting & with greening


Number
Percent


6 12 17 11 66
6% 11% 15% 10% 59%


46
41%


0% 0%


66
0% 59%


10 19 25 13 44
9% 17% 23% 12% 40%


68
60%


0% 0%


44
0% 40%










Table C-4. Estimated breakeven price by scenario


(Price* at which NPV of grove cash flows over 15-year period is positive)


New Plantings


Replantings


Mature Grove
(w/o land cost)


Base
Canker
Greening-low
G&C-low
G&C-med
G&C-high
Base
Canker
Greening-low
G&C-low
G&C-med
G&C-high
Base
Canker
Greening-low
G&C-low
G&C-med


RIDGE
Valencia Hamlin
$1.40 $1.30
$1.50 $1.40
$1.60 $1.50
$1.70 $1.60
$1.70 $1.70
$1.90 $1.80
$1.00 $0.90
$1.00 $1.00
$1.20 $1.10
$1.20 $1.20
$1.20 $1.20
$1.30 $1.30
$0.60 $0.60
$0.60 $0.60
$0.70 $0.70
$0.70 $0.80
$0.70 $0.80


FLATWOODS
Valencia Hamlin
$1.50 $1.40
$1.60 $1.50
$1.70 $1.60
$1.80 $1.70
$1.80 $1.80
$2.00 $1.90
$1.00 $1.00
$1.10 $1.10
$1.20 $1.10
$1.20 $1.20
$1.30 $1.30
$1.40 $1.40
$0.50 $0.50
$0.60 $0.60
$0.60 $0.60
$0.60 $0.70
$0.70 $0.70


INDIAN RIVER
GFT


$10.00
$13.00
$13.00
$15.00
$15.00
$17.00
$6.00
$8.00
$8.00
$10.00
$10.00
$11.00
$4.00
$7.00
$6.00
$8.00
$9.00


G&C-high $0.80 $0.80 $0.70 $0.70 $9.00
Mature Grove Base $1.00 $0.90 $0.90 $0.90 $11.00
(with land cost) Canker $1.10 $1.00 $1.00 $1.00 $14.00
Greening-low $1.10 $1.10 $1.10 $1.00 $13.00
G&C-low $1.20 $1.20 $1.10 $1.10 $15.00
G&C-med $1.20 $1.20 $1.10 $1.10 $15.00
G&C-high $1.30 $1.30 $1.20 $1.20 $17.00
*Price in $/P.S. for oranges, and $/on tree box
(fresh) for GFT












Table C-5. Average grove production costs by scenario and disease


TYPE OF PLANTINGIGROVE VARIETY LOCATION BASE CANKER GREENING-LOW

Cost/ Cost % A from Cost % A from
Acre Acre Base Acre Base

NEW PLANTINGS/REPLANTINGS* VALENCIA RIDGE \873 873 9% 1,080 35%

NEW PLANTINGS/REPLANTINGS HAMLIN RIDGE 906 906 13% 1,080 35%

NEW PLANTINGS/REPLANTINGS VALENCIA FLATWOODS 912 912 8% 1,118 32%

NEW PLANTINGS/REPLANTINGS HAMLIN FLATWOODS 945 945 11% 1,118 32%

NEW PLANTINGS/REPLANTINGS GRAPEFRUIT INDIAN RIVER 1,268 1,268 26% 1,284 27%


CANKER&GREENING CANKER&GREENINGMCANKER&GREENING
LOW ED HIGH

Cost/ % A from Costl % A from Cost/ % A from
Acre Base Acre Base Acre Base

1,080 35% 1,090 36% 1,124 41%

1,113 39% 1,122 40% 1,155 44%

1,118 32% 1,127 33% 1,160 37%

1,151 36% 1,159 37% 1,190 40%

1,394 38% 1,392 38% 1,387 38%


MATURE PLANTINGS**

MATURE PLANTINGS

MATURE PLANTINGS

MATURE PLANTINGS

MATURE PLANTINGS


VALENCIA RIDGE 932 932

HAMLIN RIDGE 966 966

VALENCIA FLATWOODS 999 999

HAMLIN FLATWOODS 1,033 1,033

GRAPEFRUIT INDIAN RIVER 1,340 1,340


1,102

1,102

1,175

1,175

1,327


* New Plantings/Replantings production costs exclude year 1 establishment costs
** Mature grove averages production costs from 15-30 year-old trees


1,105

1,137

1,179

1,211

1,432


1,095

1,126

1,173

1,204

1,409


1,068

1,097

1,157

1,186

1,347















Table C-6. Average gove yields by scenario and disease


TYPE OF PLANTINGIGROVE


VARIETY LOCATION BASE CANKER


GREENING-LOW


NEW PLANTINGS/REPLANTINGS** VALENCIA RIDGE
NEW PLANTINGS/REPLANTINGS HAMLIN RIDGE
NEW PLANTINGS/REPLANTINGS VALENCIA FLATWOODS
NEW PLANTINGS/REPLANTINGS HAMLIN FLATWOODS
NEW PLANTINGS/REPLANTINGS GRAPEFRUIT INDIAN RIVER


Boxes/ Boxes/ % A from Boxes/ % A from Boxes/ % A from Boxes/ % A from Boxes/ % A from
Acre Acre Base Acre Base Acre Base Acre Base Acre Base
527 495 -6% 488 -7% 464 -12% 450 -15% 405 -23%
622 553 -11% 576 -7% 518 -17% 503 -19% 453 -27%
527 495 -6% 488 -7% 464 -12% 450 -15% 405 -23%
622 553 -11% 576 -7% 518 -17% 503 -19% 453 -27%
526 468 -11% 487 -7% 438 -17% 425 -19% 383 -27%


MATURE PLANTINGS***
MATURE PLANTINGS
MATURE PLANTINGS
MATURE PLANTINGS
MATURE PLANTINGS


VALENCIA RIDGE
HAMLIN RIDGE
VALENCIA FLATWOODS
HAMLIN FLATWOODS
GRAPEFRUIT INDIAN RIVER


290 271 -7% 268
342 303 -11% 316
375 351 -6% 347
443 392 -12% 409
362 321 -11% 335


-8% 255 -12% 245 -16% 220 -24%
-8% 285 -17% 274 -20% 246 -28%
-7% 330 -12% 317 -15% 285 -24%
-8% 368 -17% 355 -20% 318 -28%
-7% 302 -17% 290 -20% 260 -28%


* "C & G" indicates situations where both canker and greening are present in the grove.
** New Plantings/Replantings yield averages for tree age 4 to 15
*** Mature plantings assume 119 trees/acre for ridge, 145 trees/acre for flatwoods, 95 trees/acre for GFT on
flatwoods.


C & G* LOW


C &G MED


C & G HIGH









LIST OF REFERENCES


American Institute of Real Estate Appraisers. The Appraisal ofRural Property. Chicago:
American Institute of Real Estate Appraisers 1983.

Animal and Plant Health Services (APHIS). "Greening Survey Program Update: March 16th
2006". http://www.aphis.usda.gov/ppq/ep/citrus greening/pdf files/update3-16-06.pdf

The Appraisal Institute. The Appraisal ofReal Estate (12th edition). Chicago: The Appraisal
Institute 2001.

Boscolo, M. and J.R. Vincent. "Promoting Better Logging Practices in Tropical Forests: A
Simulation Analysis of Alternative Regulations". Land Economics. v. 76, no. 1 (2000).
pp. 1-14.

Brealey, R.A. and S.C. Meyers. Principles of Corporate Finance (7th edition). Boston:
McGraw Hill 2003.

Buitendag, C.H. and L.A. Von Broembsen. "Living with Citrus Greening in South Africa".
Minutes of 12th Annual International Organization of Citrus Virologists (IOCV)
Conference. (1995) pp. 269-275.

Buongiorno, J. and B.R. Michie. "A Matrix Model of Uneven-Aged Forest Management".
Forest Science. 26(1980):609-25.

Castle, William T. "10 year Rootstock Trials at Avon Park and Indiantown." Citrus Education
and Research Center. University of Florida, Lake Alfred, FL 1994

Chen, C. "Ecology of the Insect Vectors of Citrus Systemic Diseases and Their Control in
Taiwan". Proceedings of a Regional Workshop on Management ofBanana and Ctirus
Through the Use ofDisease-Free Planting Planting Materials. Davo City, Philippines.
October 1998.

Florida Agricultural Statistics Service. Citrus Summary, various issues Orlando, FL

Florida Department of Agriculture and Consumer Services: "USDA Determines Citrus Canker
Eradication Program Not Feasible." Department Press Release 01-11-2006a.

Florida Department of Agriculture and Consumer Services. "Comprehensive Report on Citrus
Canker Eradication Program in Florida." Department Press Release 01-14-2006b.

Gottwald, T. R. and X. Sun, T. Riley, J.H. Graham, F. Ferrandino. and E. L. Taylor. "Geo-
referenced Spatiotemporal Analysis of the Urban Citrus Canker Epidemic in Florida".
Phytopathology. 92(2002a):361-377.









Gottwald, T. R., J.H. Graham, and T.S. Schubert. "Citrus Canker: The Pathogen and Its Impact".
Online. Plant Health Progress doi:10.1094/PHP-2002-0812-01-RV. 2002b.)

Graham, J.R. and C.R. Harevy. "The Theory and Practice of Corporate Finance: Evidence from
the Field". Journal ofFinancial Economics. v. 60 (2001). pp. 187-223.

Heppner, J.B. "Citrus Leafminer". IFAS EDIS: EENY038. 2003.

Hodges,A. W.D. Mulkey, R.P. Muraro, and T.H. Spreen. "County Property Values and Tax
Impacts of Florida's Citrus Industry." IFAS EDIS: FE437. 2003.

Jackson, L.K. "Citrus Reset Management." IFAS EDIS: HS142, 1994.

Jackson, L.K. and F. Davies. Citrus Growing in Florida-4 'Edition. Gainesville : University
Press of Florida, 1999

Ke, C. and C.F. Xu. "Successful Integrated Management of Huanglongbing Disease in Several
Farms of Guandong and Fujian by Combined Early Eradication with Targeted Insecticide
Spraying". Proceedings of 4 International Asia Pacific Conference on Citrus
Rehabilitation. Chiang Mai, Thailand. 1990. pp. 145-148.

Keith, Thomas. "Applying DCF Analysis to Land in Transition". The Appraisal Journal.
59(1991): 458-70.

Leite Jr., R. P., and S.K. Mohan. "Integrated Management of the Citrus Bacterial Canker
Disease Caused by Xanthomonas campestris pv. citri in the State of Parana, Brazil".
Crop Protection 9(1990):3-7.

McCoy, C.W., H. N. Nigg, L.W. Timmer, S.H. Futch, and M.E. Rogers. "2006 Florida Citrus
Pest Management Guide: Use of Pesticides in Citrus IPM". IFAS EDIS: CG035, 2005

Moss, C.B., R.N. Weldon, and R.P. Muraro. "The Impact of Risk on the Discount Rate for
Different Citrus Varities". Agribusiness. 7 (1991): 327-38.

Muraro, R.P. "Ten Year Budget Analysis for Rehabilitation of Freeze-Damaged Citrus Groves".
University of Florida, Food and Resource Economics Department Staff Paper No. 270,
January 1985.

Muraro, R.P. "Farm Real Estate Valuation". University of Florida, Institute of Food and
Agricultural Sciences Circular: 333 (March 1989).

Muraro, R.P., F.M. Roka, and R.E. Rouse. "Budgeting Costs and Returns for Southwest Florida
Citrus Production 2004-5." IFAS EDIS: FE631, 2006a.

Muraro, R.P. and J.W. Hebb. "Budgeting Costs and Returns for Indian River Citrus Production
2004-5." IFAS EDIS: FE630, 2006b.










Muraro, R.P., F.M. Roka, and R.E. Rouse. "Budgeting Costs and Returns for Central Florida
Citrus Production 2004-5." IFAS EDIS: FE629, 2006c.

Muraro, R.P. Lake Alfred interview 2/21/2006. Lake Alfred Citrus Education and Research
Center 2006d.

Muraro, R.P., F.M. Roka, and R.E. Rouse. "Budgeting Costs and Returns for Southwest Florida
Citrus Production 2003-4." IFAS EDIS: FE528, 2005a.

Muraro, R.P. and J.W. Hebb. "Budgeting Costs and Returns for Indian River Citrus Production
2003-4." IFAS EDIS: FE527, 2005b.

Muraro, R.P., W.G. Hartt, and W.C. Oswalt. "Budgeting Costs and Returns for Central Citrus
Production 2003-4." IFAS EDIS: FE526, 2005c.

Muraro, R.P. and S. Futch. Lake Alfred interview 10/6/2005. Citrus Education and Research
Center, Lake Alfred, FL, 2005.

Muraro, R.P., J.W. Hebb, and E.W. Stover. "Budgeting Costs and Returns for Indian River
Citrus Production 2002-3." IFAS EDIS: FE433, 2004.

Muraro, R.P. and W.C. Oswalt. "Budgeting Costs and Returns for Central Florida Citrus
Production 2002-3." IFAS EDIS: FE432, 2004.

Muraro, R.P., F.M. Roka, and R.E. Rouse. "Budgeting Costs and Returns for Southwest Florida
Citrus Production 2002-3." IFAS EDIS: FE434, 2004.

Muraro, R.P. and F.M. Roka. "Citrus Reset Analysis." IFAS EDIS:FE365, 2003.

Muraro, R.P., F.M. Roka and T.H. Spreen. "Grower Costs of Having Citrus Canker in Florida".
IFAS EDIS: FE286, 2001.

Muraro, R.P., and W.S. Castle. "Resetting and replanting options in Florida citrus groves and the
financial consequences." Proceedings of the Florida State Horticulture Society 109: 128-
131. 1996.

Mongi Z., T. A. Obreza and R. Koo. "Irrigation, Nutrition, and Citrus Fruit Quality." IFAS
EDIS: SL207, 2003.

Morgan, K.T. and E.A. Hanlon. "Improving Citrus Nitrogen Uptake Efficiency: Understanding
Citrus Nitrogen Requirements." IFAS EDIS: SL240, 2006.

Obreza, T.A. and M. E. Collins. "Common Soils Used for Citrus Production in Florida." IFAS
EDIS: SL193, 2002.









Parsons, L.R. and W. Wheaton. "Tree Density, Hedging, and Topping." IFAS EDIS: HS1026.
2006.

Parsons, L.R. and B.J. Boman. "Microsprinkler Irrigation for Cold Protection of Florida Citrus".
IFAS EDIS: HS931, 2003.

Reynolds, J.E. and A. Deas. "Florida Agricultural Land Values Increase: 2000 Survey Results."
IFAS EDIS: FE214, 2000.

Reynolds, J.E. "Citrus Land Values Decline as Other Land Values Increase: 2001 Survey
Results." IFAS EDIS: FE321, 2001.

Reynolds, J.E. "Agricultural Land Values Increase as Citrus Land Values Decrease: 2002 Survey
Results." IFAS EDIS: FE360, 2001.

Reynolds, J.E. "Agricultural Land Values Increase: 2003 Survey Results." IFAS EDIS: FE439,
2003.

Reynolds, J.E. "Nonagricultural Demand Causes Agricultural Land Values to Increase." IFAS
EDIS: FE545, 2005.

Reynolds, J.E. "Strong Nonagricultural Demand Keeps Agricultural Land Values Increasing."
IFAS EDIS: FE625, 2006.

Rodgers, M.E. "Management of Asian Citrus Psyllid." Presentation at the Citrus Research and
Education Center, Lake Alfred, Florida, 2006.
http://citrusbmp.ifas.ufl.edu/Workshop%20Presentations/Psyllid%20IPM.pdf

Roka, F.M., R.E. Rouse, and R.P. Muraro. "Comparison of Yields by Tree Age and Rootstock
in Southwest Florida Orange Groves". Proceedings of the Florida State Horticultural
Society. 113(2000):

Roka, Fritz M. "Southwest Florida Citrus Yield by Tree Age in High Density Plantings."
Proceedings of the Florida State Horticultural Society. 110(1997): 79-82.

Roistacher, C.N. "The Economics of Living with Citrus Disease Huanglongbin (Greening) in
Thailand". Minutes of 13th Annual International Organization of Citrus Virologists
(IOCV) Conference. (1996) pp. 279-284.

Rouse, B. and S. Futch. "Start Now to Design Citrus Groves for Mechanical Harvesting." IFAS
EDIS: HS974, 2004.

Savage, Z. "Citrus Yields per tree by age." University of Florida Food and Resource Economics
Department Circular: 60-8, 1960.









Schubert, T.S. and X. Sun. "Bacterial Citrus Canker". FDACS Plant Pathology Circular # 377.
April 2001 (3rd revision).

Spreen, T.H., W. Fernandes., C. Moreira, and R. P. Muraro. "An Economic Evaluation of
Hamlin versus Valencia Orange Production in Florida." IFAS EDIS: FE 300, 2004.

Spreen, T.H., et al. An Economic Assessment of the Future Prospectsfor the Florida Citrus
Industry. Food and Resource Economics Department, University of Florida, 2006.
http://www.floridajuice.ifas.ufl.edu/pubs/EconAssessment.pdf

Spreen, T.H., and R.P. Muraro, F.M. Roka. "An Overview of Argentina's Canker Control
Program". IFAS EDIS: FE285, 2001.

Stover, E., A. Wheaton, G. Albrigo. "Chemical Thinning of Citrus with NAA for Bigger Fruit,
Less Branch Breakage, and More Regular Cropping". IFAS EDIS: CH147, 2001.

Stover, E., and F. Davies. "Gibberellic Acid to Enhance Juice Yield and Late Season Quality of
Processing Oranges". IFAS EDIS: CH145, 2001.

Stover, E., D. Scotto, and J. Salvatore. "Spray Applications to Citrus: Survey of Current
Practices in the Indian River Area". IFAS EDIS: HS850, 2002a.

Stover, E., D. Scotto, C. Wilson, and M. Salyani. "Spray Applications to Citrus: Overview of
Factors Influencing Spraying Efficiency and Off-Target Disposition". IFAS EDIS:
HS128, 2002b.

Stover, E. and W.S. Castle. "Citrus Rootstock Usage in the Indian River Region" IFAS EDIS:
HS129, 2002.

Vichitrananda, S. "Disease Management of Citrus Orchards Planted with Disease-Free Seedlings
in Thailand". Proceedings of a Regional Workshop on Management of Banana and
Ctirus Through the Use of Disease-Free Planting Planting Materials. Davo City,
Philippines. October 1998.

Xu, C.F., D.C. Wang, and C. Ke. "A Report of Implementation of Integrated Control Program
of HLB, aiming at renovating old infected orchard, in epidemic zone and protecting non-
infected orchard in non-infected zone". Proceedings of the 6t Annual Asia Pacific
Workshop on Integrated Citrus Health Management. Kuala Lumpur, Malaysia 1991. pp.
55-61.

Zekri, M. and T.A. Obreza. "Plant Nutrients for Citrus Trees." IFAS EDIS: SL200, 2003.

Ziegler L.W. and T. Wolfe. Citrus Growing in Florida. Gainesville: University of Florida Press,
1975.











BIOGRAPHICAL SKETCH

Jordan Malugen is a native of the state of California and completed his Bachelor of Arts in

International Political Economy at the Colorado College in Colorado Springs, Colorado. Prior to

entering the University of Florida's Food and Resource Economics Master's program, he held

positions at the First National Bank in San Diego as an intern in both the foreign exchange and

corporate lending areas, U.S. Foreign Commercial Service in Buenos Aires, Argentina as an

intern, The Bank of New York, New York as an international banking associate, DSF Global as

head of finance and Peruvian market development manager, and Garuda Thai Corporation as

office manager. During his time at the University of Florida, he was the recipient of the Ross

Travel Award for research into the Brazilian citrus industry in conjunction with the International

Agricultural Trade and Policy Center (IATPC). Upon leaving the program, Mr. Malugen began

working for Prudential Real Estate Investors Latin America where he is an associate portfolio

manager. Currently, Mr. Malugen resides in Rio de Janeiro, Brazil.





PAGE 1

1 NEW CHALLENGES TO FLORIDA CITRUS: A CAPITAL BUDGETING ANALYSIS OF THE IMPACT OF CITRUS CANKER, GREENING, AND RURAL LAND PRICES ON FLORIDA CITRUS GROWERS By JORDAN CARTER MALUGEN A THESIS PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARITAL FULLFILLMENT OF THE REQUIREMENTS FOR THE DE GREE OF MASTER OF SCIENCE UNIVERSITY OF FLORIDA 2009

PAGE 2

2 2009 Jordan Carter Malugen

PAGE 3

3 ACKNOWLEDGMENTS First, to my parents, whose insistence that I finish this work on a timely basis was mostly ignored but not forgotten. Second, to my good friend and intellectual superior Dr. Fredrick Houts, whose accomplishments serve as an example of diligence for me an d all who know him. Third, to Dr. Thomas H. Spreen who recruited me and led me into a new discipline that will serve me for the rest of my life. Fourth to Prof essor Ronal d Muraro who taught me the nuts and bolts of the Florida citrus industry. Fifth to Dr. Charles Moss who always challenged me to expand my understanding and perception of the world around me and provided valuable advice on writing this thesis. Sixth to Senior Vice President Jimmy Cheek, who provided me with the financial support and working environment to complete my work. Lastly, to the people of Florida and the Florida citrus growers, who made this research possible.

PAGE 4

4 TABLE OF CONTENTS page LIST OF TABLES ................................ ................................ ................................ .......................... 6 LIST OF FIGURES ................................ ................................ ................................ ........................ 8 ABSTRACT ................................ ................................ ................................ ................................ .... 9 CHAPTER ................................ ................................ ................................ ................................ .... 11 1 INTRODUCTION ................................ ................................ ................................ ................. 11 2 ESTABLISHMENT COST, YIELD, AND INVESTMENT PARAMETERS FOR CITRUS PRODUCTION IN FLORIDA ................................ ................................ ............... 15 Modeling Citrus Production ................................ ................................ ................................ .. 15 Gr ove Care and Operating Cost Considerations ................................ ................................ .... 17 3 ACCOUNTING FOR THE EFFECTS OF CITRUS CANKER AND GREENING ON FLORIDA COMMERCIAL CITRUS PRODUCTION ................................ ........................ 33 Citrus Canker ................................ ................................ ................................ ......................... 33 Citrus Greening ................................ ................................ ................................ ...................... 38 4 A NET PRESENT VALUE MODEL OF A FLORIDA CITRUS GROVE ......................... 46 Net Present Value Theoretical Framework ................................ ................................ ............ 47 Adapting NPV Analysis to the Citrus Grove ................................ ................................ ......... 63 5 E MPIRICAL RESULTS ................................ ................................ ................................ ....... 72 Results of the Mixed Age Grove Model Yield and Cost Analysis ................................ .... 72 Results of the Mixed Age Grove Model Breakeven Price Analysis ................................ .. 81 6 SUMMARY AND CONCLUSIONS ................................ ................................ .................... 92 APPENDIX ................................ ................................ ................................ ................................ ... 99 A GEOGRAPHIC AND TOPOGRAPHIC FEATURES OF FLORIDA COMMERCIAL CITRUS PRODUCTION REGIONS ................................ ................................ .................... 99 B PARAMETERS USED IN THE ANALYSIS ................................ ................................ ..... 104 C SELECTED RESULTS ................................ ................................ ................................ ....... 117 LIST OF REFERENCES ................................ ................................ ................................ ............ 124

PAGE 5

5 BIOGRAPHICAL SKETCH ................................ ................................ ................................ ...... 129

PAGE 6

6 LIST OF TABLES Table page 2 1 Florida citrus marketing by variety, 2005 06 s eason ................................ ............................. 21 2 2 Spray budget comparison: fresh versus processed, cost per acre ................................ ........... 21 3 1 Tree loss percentages used in analysis ................................ ................................ ................... 42 3 2 Annual per acre spray costs by disease scenario ................................ ................................ .... 45 4 1 Discounting example ................................ ................................ ................................ .............. 54 4 2 Risk adjusted discount rates by variety ................................ ................................ .................. 57 4 3 Discount rates used in citrus investment analysis ................................ ................................ .. 58 4 4 Built up capitalization rate method used in analysis ................................ .............................. 62 4 5 Comparable Florida grove sales ................................ ................................ ............................. 63 5 1 Beginning tree age distribution for mature Valencia on the Ridge ................................ ........ 74 5 2 Initial investment costs by scenario ................................ ................................ ........................ 79 5 3 Tree loss percentage by scenario ................................ ................................ ............................ 80 5 4 Estimated breakeven prices across disease scenarios, varieties, and production r egions ...... 83 5 5 Grapefruit packout price vomparison ................................ ................................ ..................... 87 5 6 Hamlin yield loss sensitivity ................................ ................................ ................................ .. 88 5 7 Tree loss comparison for a Valencia grove on the Ridge with greening ................................ 90 A 2 Average citrus land preparation costs, 2002 03 season ................................ ....................... 103 A 3 Land utilization of Florida citrus groves ................................ ................................ ............. 103 B 1 Solidset costs by disease scenario for a Valencia orange grove in the ridge ....................... 105 B 2 Reset costs by disease scenario for a Valencia located in the ridge ................................ .... 106 B 3 New planting/replanting operating costs for a Valencia grove (without canker o r greening) ................................ ................................ ................................ ................................ ... 107 B 4 Operating costs for a mature (15+ year old)Valencia grove located on the ridge (without canker or greening) ................................ ................................ ................................ ... 108

PAGE 7

7 B 5 Harvest and other per box costs ................................ ................................ ........................... 109 B 6 Adjustment factors for grove care cost by tree age ................................ .............................. 109 B 7 Annual irrigation expense (ridge/flatwoods comparison) ................................ .................... 110 B 8 Average per acre citrus land preparation costs (ridge/flatwoods comparison) .................... 110 B 9 Property tax lev y for top five citrus producing counties, 2003 ................................ ............ 110 B 10 Property tax analysis assumptions ................................ ................................ ..................... 111 B 11 USDA average yields by variety and production district, 1999 2004 average .................. 111 B 12 Rootstock study for Valencia oranges on ridge and flatwoods sites ................................ 1 12 B 13 Fruit and juice yield by variety used in the analysis ................................ .......................... 112 B 14 Mature grove production costs with canker by production region ................................ .... 113 B 15 Mature grove production costs with greening by production region ................................ 114 B 16 Mature grove production costs with canker and greening ................................ ................. 115 B 17 Spray schedule and costs by variety and disease scenario ................................ ................. 116 C 1 Tree age distribution of a solidset Valencia grove, base scenario ................................ ....... 118 C 2 Yields for a solidset Va lencia grove base scenario ................................ ............................ 119 C 3 Reset strategy beginning/ending tree distributions under disease scenarios ....................... 120 C 4 Estimated breakeven price by scenario ................................ ................................ ................ 121 C 5 Average grove production costs by scenario and disease ................................ .................... 122

PAGE 8

8 LIST OF FIGURES Figure page 2 1 Evolution of Florida citrus grove density (source: 2004 05 Florida Citrus Summary) ......... 16 2 2 Working capital illustration ................................ ................................ ................................ ... 29 2 3 Application of working capital to citrus investment ................................ ............................. 29 3 1 Indonesian citrus production, 1975 2005 ................................ ................................ .............. 40 3 2 Thai citrus production, 1975 2005 ................................ ................................ ........................ 41 3 3 South Africa citrus production, 1975 2005 ................................ ................................ ........... 42 4 1 Relationship of NPV and IRR ................................ ................................ ............................... 51 4 2 Tree age distribution matrix ................................ ................................ ................................ .. 64 4 3 Cost calculation by tree age (original trees) ................................ ................................ .......... 68 4 4 Reset tree age matrix ................................ ................................ ................................ ............. 69 5 1 Costs and yields for a newly planted Valencia grove on the Ridge ................................ ...... 74 5 2 Costs and yields for a mature Valencia grove on the Ridge ................................ .................. 74 5 3 Costs and yields for mature Indian River grapefruit grove with canker ............................... 76 5 4 Costs and yields for mature Hamlin flatwoods grove with greening ................................ .... 76 5 5 Resetting comparison ................................ ................................ ................................ ............ 77 A 1 Florida commercial citrus acreage map, 2005 ................................ ................................ .... 100 A 2 Florida citrus soil types ................................ ................................ ................................ ....... 101 A 3 Illustration of fla twoods grove design ................................ ................................ ................ 101

PAGE 9

9 A b stract of Thesis Presented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Master of Science NEW CHALLENGES TO FLORIDA CITRUS: A CAPITAL BUDGETING ANALYSIS OF THE IMPACT OF CITRUS CANKER, GREENING, AND RURAL LAND PRICES ON FLORIDA CITRUS GROWERS By Jordan Carter Malugen August 2009 Chair: Thomas H. Spreen Major: Food and Resource Economics The Florida citrus industry provides over $9.2 billion dollars in direct and indirect expenditures ; employs more than 75,000 people, mainly in rural areas ; and is an emblematic feature of the landscape a nd history of Florida. After the disastrous hurricane seasons of 2004 and 2005, Florida citrus acreage is now at its lowest point since the tracking of citrus tree acreage first began in 1966, and may decline further due to the twin challenges of diseases known as citrus canker and citrus greening, and the rapid urbanization of the state. This study conducts an expansive survey of current growing practices and collects available information regarding costs, returns, and yields to create a detailed set of parameters. These parameters are analyzed to determine the economics of an investment in citrus within a net present value framework, and uses scenario analysis to test for effects on the profitability of a citrus investment due to these new challenges. Parameters and assumptions are defined to reflect average costs and yields of a Florida citrus grove in normal operations and under the scenarios of canker, greening, and increased land prices. An empirical present value model is created which dynamicall y reflects the changes in costs, yields, and tree loss and replacement (resetting) through a fifteen year period. The

PAGE 10

10 analysis examines the citrus investment by looking at: tree yields and costs by variety (Valencia orange, Hamlin orange, and red grapefr uit), age of the grove (new planting versus mature grove), location (the Central ridge, Southwest Florida flatwoods, and the Indian River regions), the presence of disease in various severities (canker and greening), and changes in land prices. The effect of these variables is measured through changes in the breakeven price of one unit of production (pound solid for oranges or on tree box for grapefruit). The breakeven price is defined as the minimum price guaranteeing a positive net present value througho ut the fifteen year analysis period. Results are presented to help understand how the challenges affecting the whole industry may affect the investment decisions faced by the thousands of individual growers, service providers, and employees who make up th is industry and, ultimately, whose livelihood depends on it.

PAGE 11

11 CHAPTER 1 INTRODUCTION Florida is the largest producer of citrus in the United States, and second only to Brazil in the entire world. Florida is the second largest producer of orange juice in t he world, and the largest producer of grapefruit. The 2005 2006 Florida citrus crop was estimated at over $1 billion in value, moreover the Florida citrus industry provided over $9.2 billion dollars in direct and indirect expenditures to the state GDP and employed more than 75,000 people throughout the state (Spreen et al. 2006). Unfortunately, while the 2005 6 crop was the second highest valued crop in Florida history due to high prices, the total acreage of Florida citrus fell 17% from 748,555 to 621,37 3 acres over the last two years. It is now at its lowest point since the tracking of citrus tree acreage first began in 1966, and may decline further due to the twin challenges of diseases known as c itrus c anker and c itrus g reening, and the rapid conversi on of agricultural land to re sidential and commercial uses. These challenges are unfamiliar to Florida growers and contain the possibility of fundamentally altering the production and cost structure of the Florida citrus industry. Citrus canker is a bacte rial disease of citrus that causes lesions (or cankers) on the fruit and leaves of citrus trees, reduces tree productivity, and severely a ffects the marketability of fresh citrus fruit. Citrus greening is a bacterial disease of citrus that kills trees and is spread by the invasive insect species, the Asian c itrus p syllid. Finally, rapidly expanding Florida population and conversion of rural lands to urban use ha ve greatly increased the price of agricultural land suitable for citrus production and is changing the highest and best use of rural land in many traditional citrus production areas. It appears that these challenges are having an effect on citrus growers, b ut there is a lack of economic analysis focused on the current and projected investment e nvironment for Florida citrus.

PAGE 12

12 This analysis is a continuation of research conducted for a report prepared for the Florida Department of Citrus by the Food and Resourc e Economics Department of the University of An Economic Assessment of the Future Prospects for the Florida Citrus Industry was an in depth examination of the challenges listed abov e. This study extends the results co authored with Ronald Muraro of the University of Florida Lake Alfred Citrus Education and Research Center (Lake Alfred CREC) and reported in Chapter 5 of the original report summarizing the effects of canker, greenin g, and urbanization on a citrus investment. The grove operating costs of the investment model presented in the study and this analysis are based on annual citrus production cost budgets assembled by Ronald Muraro from surveys with growers and caretakers a round Florida. Yield information is taken from studies by Drs. William Castle and Fritz Roka, 10 Year Rootstock Trials at Avon Park and Indiantown (Castle 1994) and High Density Plantings in Southwest Florida (Roka et al. 1997) plus Revision to the Roots tock Bulletin (Castle 1999). Information of grapefruit yields by tree age was obtained from state wide average production figures from the 2005 0 6 Citrus Summary as no current studies of Florida grapefruit yield by tree age exist. A review was conducted of applicable horticultural, plant pathology, and agricultural engineering literature to create and verify assumptions about costs, cultivation methods, and the effects of canker and greening on a citrus grove. These references are cited appropriately where applicable. This study attempts to fill a gap in the current analysis of the challenges facing the Florida citrus industry by quantifying current scientific literature on canker and greening with an economic a nalysis to illustrate the contemporary investment decision of growers planning on continuing to operate in the citrus industry over the next 15 years. Given the importance of the

PAGE 13

13 Florida citrus industry in its economic, social, and historic contributions to the state, an analysis is required that examines the quantitative effects of these challenges on individual growers. Clues to the observed decline of bearing citrus acreage at the state wide level can be found at the level of the individual growers bas ed on the changing economics of growing citrus and investing in new citrus production in Florida. Since growing citrus is a business activity, this study presents an analysis of the profitability of an investment in citrus within a capital budgeting frame work. Prices, yields, costs, and disease effects vary by variety and grove location, so this analysis creates five hypothetical Florida groves. Grove situations for Valencia and Hamlin sweet oranges in both the Central Florida Ridge and Southwestern Flori da Flatwoods production regions are considered. Valencia and Hamlin varieties were selected because of their widespread planting and predominant use for juice processing. A grove situation of colored grapefruit in the Indian River production region was s elected because of the popularity of fresh Indian River grapefruit. Therefore, this analysis assumes all Valencia and H amlin oranges will be utilized for processing and grapefruit is intended for the fresh market. This study begins with creating parameter s and assumptions to reflect average costs and yields of an operating citrus grove. First, costs and start up considerations are examined for establishing a citrus grove, including planting density, grove architecture, irrigation, and land preparation. S econd, operating expenses are defined for chemical applications, cultivation, fertilizer, irrigation, tree removal and replacement, property taxes, operating capital, and management costs. Third, the analysis examines citrus tree yields by variety and nor mal tree loss. Fourth, the analysis quantifies the effects of citrus canker and greening on the grove, and the additional costs, tree loss, and yield effects these diseases entail.

PAGE 14

14 After the assumptions and parameters of the analysis are defined, an empi rical present value model of the citrus investment is created. The capital budgeting framework is presented and its application to the citrus grove is explained. Finally, scenarios representing a canker and greening free grove, the presence of each canke r and greening in the grove, increases in land prices, and combinations of all three are examined to quantify changes in the returns to a citrus investment. Results are presented to help understand how the challenges affecting the whole industry may affec t the investment decisions faced by the thousands of individual growers, service providers, and employees who make up this industry and, ultimately, whose livelihood depends on it.

PAGE 15

15 CHAPTER 2 ESTABLISHMENT COST, YIELD, AND INVESTMEN T PARAMETERS FOR CIT RUS PRODUCTION IN FLORID A An important first step in this analysis is to make accurate assumptions and define parameters that reflect the reality of an average citrus grower in Florida. While the individual situation of a grower will vary, the cost and yield assumptions are presented are based on a study of common practices in the citrus industry. Cost parameters are based on observed prices and projections on their future levels, while yield parameters are based on referenced studies. First, a discussion is presented of the factors important in current Florida citrus production and key to the construction of any analysis model for citrus. Second, research of expected yields by variety and tree age is presented, and model yields are constructed for our hypot hetical groves. Additional information on considerations for growing citrus in Florida and differences between the ridge and flatwoods citrus production areas is available in Appendix A: Geographic and Topographic Features of Florida Commercial Citrus Pr oduction Areas Modeling Citrus Production Grove Establishment Considerations Planting a new grove or removing and replacing an existing grove is referred to as a time costs are incurred for land preparation and irrigation installation. The number of citrus trees per acre and the spacing of trees must ba lance productivity, access, and the efficient use of the grove area. Tree spacing is defined by in row and between row (or fertilizer, and sprays but not so many as to crowd each other out and reduce overall productivity. Moreover, the grove must have space to allow access for grove equipment and harvesting. Early

PAGE 16

16 Wolfe 1975) Modern grove care techniques and a better understanding of an efficient bearing and profit maximizing grove have pushed tree density much higher over the past two decades. Current hedging, pruning, fertilization, irrigation, and precision agriculture practices spacing. Higher density plantings have also been shown to provide an earlier return on investment and a more efficient use of equipment, materials, and lan d (Parsons and Wheaton 2006). The trend towards higher density plant ings is illustrated in Figure 2 1. Figure 2 1 Evolution of Florida c itrus g rove d ensity (source: 2004 0 5 Florida Citrus Summary) As illustrated in Figure 2 1, the last large increase in tree density occurred during the late 1980s and early 1990s during a period of intensive replanting of a large number of groves destroyed during the freezes of the 1980s. Currently, there are indications that tree density may increase again due to the ex tensive losses of trees under the canker eradication program, new precision agriculture practices, and mechanical harvesting. Increasing labor costs and competition from Brazil are making mechanical harvesting of citrus fruit an attractive option for many

PAGE 17

17 In this analysis, new planting densities are assumed to be 198 trees per acre ( Mature groves tree densities are taken from the 2003 4 IFAS Citrus Production Budgets as common densities for existing groves (Muraro 2005 I, II, II I). Mature grove densities are assumed to be 112 trees per acre for Valencia and Hamlin on the Ridge, 145 trees per acre for Valencia and Hamlin on the Flatwoods, and 95 trees per acre for grapefruit. In the case of a new or replanting of citrus, this ana lysis uses an irrigation installation and setup cost of $1000 per acre for the ridge and flatwoods production areas. New plantings may require a well to be drilled, which increases the cost of installation, but this is not included in the analysis. A rep lanted grove is assumed to incur the same cost for irrigation installation due to two observed practices (Muraro and Futch 2006). First, the irrigation system is usually damaged system layout is usually required, especially if there are changes to tree density or other grove architecture. This analysis does not include the costs of removing or pushing the previous grove, and starts with the assumption that the land is vacant. Pr eparing open land for citrus varies substantially by topographic area (ridge versus flatwoods). Flatwoods groves incur higher land preparation costs compared to ridge groves. Changes to grove architecture and/or tree density require incurring costs f or soil preparation and bed construction all over again. Therefore, this analysis assumes that new plantings and replantings of citrus will incur the same land preparation costs. Average citrus land preparation costs used in this analysis are summarized in Appendix Table B 10. Grove Care and Operating Cost Considerations Citrus fruit is utilized either in the fresh processed market, and in both cases must be transported from the tree to the juice processing plan t or fresh fruit packing house. This proces s

PAGE 18

18 is currently accomplished in three steps: picking the fruit off the tree, roadsiding it by transporting it from inside the grove to a central loading point, where the fruit is then hauled to its final destination. These costs are influenced by wage rate s, equipment/materials costs, and fuel/energy costs. These unit costs are substantial, usually are incurred on a per box basis, and may exceed grove care costs. Harvesting costs have remained somewhat stable over the past decade, and this enables the grow er to project how much it will cost with some certainty. Wage rates, fuel/energy costs (until recently), and equipment/materials costs have remained stable. Unfortunately, there are uncertainties in the supply of agricultural labor, especially for groves located outside of the major Florida production areas and for late season vari eties such as Valencia oranges. Grapefruit prices in this analysis are quoted as the industry pick, roadside, and haul is already subtracted and they do not include a harvesting charge. This analysis uses average reported costs from the 2004 05 season of $1.64/box for picking and road siding, and $.47/box for transporting the fruit to the juice processing plant for a total of $2.11 (Muraro 2006 II) Details of individual per box costs can be found in Appendix Table B7. er box excise tax to fund citrus marketing and industry research. While there have been several legal challenges to the box tax, plus a current proposal to raise the box tax to $0.25, this analysis assumes a rate of $0.185 per box, giving a total per box cost of $2.30. Due to the special handling requirements for fresh fruit, an extra charge of $1.50 per box is assumed for citrus fruit to be marketed as fresh. Additional handling can include special packaging and transportation from the grove to ensure th e visual appeal of the fruit. Moreover,

PAGE 19

19 spot picking is a common practice in fresh fruit groves, where pickers identify and ensure only the highest quality fruit is picked and sent for sale as fresh. The assumed pick and haul cost for fresh market fruit is $3.80 per box. For most growers, agricultural chemical and application costs are the largest production cost after harvest costs. The diverse uses of agricultural chemicals in citrus for pest control, disease control, growth regulation, and nutritional supplementation blur the classifications of fixed variable costs and range from certain to uncertain. It is the difficult task of the citrus grower to balance the health and productivity of his/her trees while minimizing the cost of materials used. In p ractice, this is a subjective judgment based on the individual experience of the grower as illustrated by a 2001 survey of spray practices in the Indian River region. Research and extension literature on citrus spraying rightly focuses on the complexity of predicting effects of spray practices on distribution of materials within trees, even in controlled experiments. Consequently, recommendations from authorities often provide limited guidance to growers. This forces the industry to explore spraying as an a rt, in which changes are attempted on an ad hoc basis and either rejected or continued based on individual experience or reports from peers. The tremendous range of grower spray practices appears to reflect the current status of this ongoing, largely indep endent, experimentation by individual growers (Stover et al. 2002a) There are significant differences in spray costs for citrus fruit grown to be consumed fresh, and fruit grown for processing into juice. Fresh market fruit requires a blemish free peel t o enhance its marketability and visual appeal to the consumer. Fresh fruit is delivered to a packinghouse where it is sorted according to size and peel blemishes. The fruit judged unfit for and sent for processing into juice. The percentage of the total fruit delivered to the packinghouse that is fit for fresh market eliminated fruit that passes through its packing line and is transported to a juice processing

PAGE 20

20 processing generally receives a significantly lower price than fresh. Therefore, it is i mperative that a grower obtains a high packout rate to maximize the amount of his production receiving the highest price, and minimize the possibility of receiving a lower price for eliminations. This is mostly accomplished through the spray program and s pot picking practices as described in the previous section. Fungal diseases and insect damage are the two most common causes of peel blemishes and reasons for fruit elimination. Fungal infections, such as melanose, citrus scab, alternaria, and greasy spot are often controlled using fungicidal sprays containing copper and petroleum oil. Some insects, commonly mites, attack the fruit/peel and must be controlled using pesticides to ensure fresh market quality. Citrus trees are attacked by a number of foliar and root pests and diseases that affect productivity. When balancing lost productivity with the costs of chemical application, the use of chemical control is generally required when a certain level of infestation or infection is reached. Fruit grown for the processing market does not require high external quality. In this case, spray costs appear to be closer to a variable cost of production which increases with yield. In Florida, most sweet orange varieties, with the exception of Navel oranges, are gro wn for the processing market (Table 2.1). Grapefruit, tangerines, and other specialty varieties are mostly grown for the fresh market. Due to the factors discussed above, spray costs for the fresh market varieties are significantly higher than oranges fo r processing. For example, Table 2.2 illustrates the difference in spray costs between the Hamlin orange variety and the red seedless grapefruit, grown for the processed and fresh markets respectively. The reader should note that these spray programs inc lude micronutrient compounds that are mixed into a solution containing

PAGE 21

21 certain pesticides (Lorsban and copper in this case). Chemical costs for specialty fruit will be higher than traditional orange varieties for the processing market. Table 2 1 Florid a citrus marketing by variety, 2005 06 season Fresh Processed Total '000 boxes % '000 boxes % '000 boxes Early, Mids, and Navels 4,896 7% 70,104 93% 75,000 Valencia Oranges 2,450 3% 70,450 97% 72,900 Grapefruit White 1,433 22% 5,067 78% 6,500 Grapefruit Red 5,481 43% 7,319 57% 12,800 Source: USDA Citrus Fruits 2006 Summary Table 2 2 Spray budget comparison: fresh versus processed, cost per acre Hamlin Orange for Processing Summer Oil #1 88.02 Summer Oil #2 53.17 Total 141.19 Colored Grapefruit for Fresh Market Post Bloom Spray 53.32 Supplemental Post Bloom Spray 83.15 Summer Oil #1 53.32 Summer Oil #2 88.02 Fall Miticide Spray 38.54 Total 316.35 Growth regulating chemicals are applied to certain citrus varieties for the fresh market to control heavy alternate bearing between seasons. These heavy crops can be chemically thinned between seasons (Stover et al. 2001). Gibberellic aci orange varieties to delay the time of harvest and increase juice yield and quality, although there appear to be detrimental effects on subsequent cropping (Stover and Davies 2001). The application of growth regul ators is expensive with an application cost of approximately $35/acre, and a materials cost of approximately $495/acre and $34/acre, for NAA and GA respectively (Muraro 2006c). No growth regulating applications are assumed in the analysis presented

PAGE 22

22 becau se of the focus on oranges and grapefruit varieties, however for certain, primarily fresh market citrus varieties, incorporation of these costs is an important component of analysis. Intuitively, older trees with large canopy volumes should require more am ounts of chemicals, however, there is considerable variability between large tree size, high spray volume, and increased chemical costs. A 2001 UF IFAS survey of spraying practices in the Indian River growing region reported some association between spray ing large trees at a high spray volume, but some growers also reported spraying small trees at a high volume (Stover et al. 2002b). Due to the high cost of chemicals and the economics of spray efficiency, Florida citrus has moved quickly to adopt variable rate sprayers that can adjust the amount of chemical material applied to the tree size. Overall, chemical control for pests and disease requires more spray material to cover increased canopy size as trees age; however, spray costs and materials for young small, and/or non bearing trees will differ as explained in a following section on young tree care. This analysis assumes that the grove manager or caretaker uses variable rate spraying equipment methods to apply the quantity of spray material appropria te for the tree age. These costs are adjusted according to age as shown in Appendix Table B 8. A productive citrus grove must maintain a certain level of upkeep during its operation. In the hot and humid Florida environment, other plant species quickly invade a grove and compete with citrus trees for water, sunlight, and soil nutrients. Cultivation includes controlling for these uninvited plants through mechanical mowing and herbicide applications. Labor for general maintenance and upkeep is required t o perform a multitude of necessary tasks around the grove. While these costs may vary significantly, a grower is certain that they will be incurred. Estimates of cultivation and grove maintenance costs for the 2005 06 season ranged from $80 to $100 per a

PAGE 23

23 pruning, hedging, and topping. Pruning refers to removing selected limbs to alter the structure of the tree in order to r educe overcrowding between trees in a row. Crowding has a negative effect on yield, juice, and peel quality. Hedging refers to cutting back the trees from encroaching on the space between the rows (row middles), and allowing grove equipment to pass throu gh. Topping refers to cutting the top off the tree to prevent it from being excessively tall. Topping facilitates harvesting, reduces the amount of spray materials needed, and avoids the shading out of other trees (Parson and Wheaton 2006) The frequency of pruning, hedging, and topping depends on the planting density and vigorousness of the citrus variety and rootstock. Planting the trees in a tighter spacing will necessitate more frequent pruning to avoid overcrowding. Accordingly, trees planted on vi gorous rootstocks such as Rough Lemon or Volkameriana will encroach on each other faster than Swingle or Cleopatra rootstocks. A grapefruit tree will encroach faster than a Valencia orange tree. The 2004 05 IFAS Citrus Budget reports annualized total cos ts ranging from $28 to $44 per acre depending on variety and location. This analysis assumes the pruning costs to be incurred from the fourth year of tree age onwards. An adequate citrus fertilization program is essential to cultivating productive and hea lthy trees. The fertilization of citrus trees increases yields, growth, and has been shown to aid tree recovery from damage due to weather, disease, or pests (Morgan and Hanlon 2006) Citrus trees require a large amount of macronutrients (nitrogen N, pho sphorous P, and potassium K), and smaller amounts of micronutrients (iron Fe, zinc Zn, manganese Mn, boron B, molybdenum Mo, and others). Of these nutrients, nitrogen is the most important and is frequently applied in the form of solid fertilizer through multiple soil applications per year (Zekri and Obreza 2003)

PAGE 24

24 Micronutrients are applied as foliar sprays, can be combined with other chemical sprays, and are usually applied as needed when trees exhibit symptoms of micronutrient deficiency. An individual specific grove conditions. Moreover, some growers are now using fertigation techniques where macronutrients are applied in a liquid form through the irrigation system. A typical fer tilization schedule for oranges requires three annual applications by mechanized fertilizer spreaders of about 210 pounds per acre with grapefruit requiring about three quarters (150 pounds ) of that amount (Jackson and Davies 1999) IFAS estimates for sho w for the 2005 06 season a range of $50 to $70 per application per acre. This analysis assumes a cost of $205 per acre per year for oranges, and $157 per acre per year for grapefruit. This analysis does not make an allowance for micronutrient sprays. Mos t Florida soils used for citrus production are acidic with a low pH in their native state and require infrequent applications of soil amendments to raise their pH. Citrus trees grow best in a pH range of 6.0 to 6.5, and pH values outside of this range aff ect the absorption of nutrients by the tree and may reduce tree productivity and growth (Obreza and Collins 2002) The most commonly applied amendment to raise soil pH is Dolomite limestone, and this is applied as necessary by the pH level of the soil. S oil and drainage characteristics of the grove determine the behavior of soil pH, but for the purposes of this analysis, one ton per acre is assumed to be applied once every three years for an annualized cost of $13.97. Horticultural and economic considerations require most commercial citrus in Florida to be irrigated. Many Florida citrus trees are planted on porous and sandy soils that do not retain sufficient moisture for the tree all year. A citrus tree becomes drough t stressed if it does not receive enough water, and this has a negative effect on yields, juice quality, and fruit size (Mongi

PAGE 25

25 et al. 2003) Moreover, irrigation can effectively be used for cold protection during freeze events, especially for vulnerable y oung trees (Parsons and Bohman 2006). Finally, irrigation reduces yield uncertainty and mitigates risk of financial difficulty due to crop failure caused by drought. Several different irrigation systems exist and require different components and designs, but microsprinkler and micro jet irrigation have become widely adopted by Florida commercial citrus. This analysis assumes the use of a microsprinkler irrigation system and is comparable in costs to a micro jet system. Costs for operating a microsprinkle r irrigation system vary by location due to additional costs for water management in Flatwoods groves. In the Florida citrus industry, the process of removing a dead or unproductive tree and unexplainable factors claim the lives of citrus trees. Resetting is an important part of maintaining a citrus grove at maximum be aring efficiency with a full complement of healthy trees. The publicly available Florida Commercial Citrus Tree Inventory is conducted every two years by the FASS, since 1966. Change in commercial citrus acreage is determined by aerial photography, that identifies the number of existing trees by variety and year planted. The average tree loss by age group used for this analysis is 1% for trees aged 1 3 years, 1.5% for trees aged 4 11 years, and 3% for trees 12+ years of age. 1 1 This analysis uses an unpublished analysis conducted by Dr. Mark Brown of the Florida Department of Citrus which compared the changes in the tree inventories by tree age from 1994 to 2 004, interpolating for between survey years. After subtracting for non bearing trees to eliminate for newly planted trees and for canker eradications, a linear regression line was fit to account for the increase in losses as trees age. Unfortunately, thi s data may include some citrus acreage lost to non agricultural development, and overestimate the actual tree loss suffered in a healthy grove; however, interviews of grove managers conducted by the author confirm that these loss rates are reasonable.

PAGE 26

26 Resetting a new tree in a ma ture grove requires incurring immediate and continuous costs for up to three years. In the near term, the dead/unproductive tree must be removed and the new tree purchased and planted. This involves additional labor, materials, and equipment time to pull out the dead tree and dispose of it, clear weeds, aerate the soil, apply a soil fumigant, and plant the new tree (Jackson 1994) In the longer term, the newly planted tree requires additional care such as, removing unwanted sprouting, weed control, speci al fertilization and irrigation programs, and the maintenance of cold insulating tree wraps. See Appendix B for detailed cost information. Given the costs involved and the delay for reset trees to come into production, growers attempt to optimize their re setting strategy for maximum economic gain. Nursery trees are usually ordered one or two years in advance, and special equipment and labor must be arranged for planting. IFAS Extension publishes an on line decision aid for optimal resetting strategy that includes costs, yields, prices, and loss rates (Roka et al. 2000). It is suggested that in high density and new plantings, a program of continuously resetting dead/unproductive trees may increase returns to investment; however, IFAS Citrus Economist Rona ld Muraro observes that, under field conditions, most growers only reset trees every other year (biennial resetting) or longer (Muraro 2006d). In addition to grove care expenses, there are general operating expenses which must be considered. Growers may h ave fixed costs for buildings, equipment, and other costs that cannot be allocated just to a single grove or on a per acre basis. Since these costs are highly dependent mptions fixed expenses such as equipment use, structures, and grove administration by charging a

PAGE 27

27 management fee. Property taxes are included on a per acre basis, accounts for tools, repairs, and additional grove labor. Citrus production management in Florida is a highly diverse field, with many grove caretaking tasks being contracted to third party caretakers. The spectrum runs from grove owners who own production equipment (tractors, sprayers, harvesting equipment, etc.) and hire employees, to owners who contract all production work, including harvesting, for a set fee or percentage of revenue. IFAS citrus production budgets design managed production costs, IFAS citrus production budgets incorporate a 10% surcharge on materials cost Many growers fall in between these two extremes, and own some grove equipment, perform some production work themselves, contract for other work, or perform contract work themselves. In this analysis, cos ts are reported for an owner managed operation. Figures given for spray and fertilizer materials costs are reduced by 10% from reported IFAS citrus production budgets. All other grove care costs reflect an owner managed operation with equipment depreciat other fixed and indirect expenses not directly incorporated into the grove care costs. Property tax on Florida agricultural land is known as the millage rate, and is calcu lated on a per $1000 of assessed value basis. Reported millage rates range from a low of 11.5 per $1000 of assessed value (1.15% per year) in Collier County to a high of 29.6 per $1000 (2.96% per year) in Pinellas County. Millage rates for the top four c itrus producing counties are illustrated in Appendix B Table B 11 (Hodges et al. 2003)

PAGE 28

28 The land value used for property tax assessment (the assessed value) of agricultural enterprises will usually be lower than the market (just) land value. The tax ass essed value is based on the value of the land derived from the returns to agricultural use. The procedure used to assess agricultural value differs by county and the tax assessed land value varies widely. In this analysis, an average millage rate of 19.5 (1.95%/year) is assumed, with an assessed value of $3,600 per acre for a mature grove, and $1,550 per acre for a new planting or replanting which results in about $70 per year and $30 per year in property taxes, respectively. The values were put into 200 3 figures because that is the last publication available with all country agricultural property tax rates collected (Hodges et al. 2003) The just value given for a mature grove and a new/replanted grove is taken from the 2003 IFAS Florida Rural Land Valu e Survey (Reynolds 2003) The dollar amount of property tax is assumed to increase by 2.5% per year over the 15 year period of analysis reflecting natural growth in the value of agricultural and basic inflation. A miscellaneous cost of 2% of grove care ex penses is added to account for general grove labor and materials. In the base scenario, this cost varies from $14.65 per acre for oranges on the ridge to $19.80 per acre for grapefruit on the flatwoods. This is based on the observation that there are man y indirect costs and expenses incurred in grove management for additional labor, tools, and materials. Cash outflows (expenses) to pay for the previously described expenses are incurred throughout the year. Citrus trees in Florida produce one crop per yea r that generates a cash inflow (revenue). Many different payment schemes exist where growers contract for delivery of the fruit and receive a portion of the total payment before delivery. One method to value the timing mismatch between cash inflows and o utflows due to operations is referred to as working

PAGE 29

29 or operating capital. Working capital is an accounting term that is defined as current assets minus current liabilities. It consists for three important components: Figure 2 2 Working capital illustration In the normal course of business, income and expenses are not instantly converted into cash, but credited to or debited from a receivables(income) or payables(expenses) account. Many suppliers of agricultural materials and equipment extend credit or delay payment for a certain period. Inventory is usually considered an asset in working capital becau se it can quickly be converted into cash to pay expenses. In the case of citrus, the fruit cannot be harvested before maturity, but it can be contracted for delivery and some payment received. Working capital reflects the liquidity of a firm, and changes with the mix of cash inflows and outflows. For contracted at a specific price per box. Therefore, working capital increases as the grower has more money w ith which to pay his/her bills. If grove care expenses increase, accounts payable increases and working capital decreases. Cash Inflow Cash Outflow Increase in A/R (+) ( ) -Decrease in A/R ( ) (+) -Increase in Estimated Crop (+) (+) -Decrease in Estimated Crop ( ) ( ) -Increase in A/P ( ) -( ) Decrease in A/P (+) -(+) Figure 2 3. Application of working capital to citrus investment Working Capital = Invento ry + Accounts Receivable Accounts Payable (Sales Revenue) (Operating Expenses)

PAGE 30

30 Although the actual cost of maintaining working capital throughout the season varies significantly by grower circumstance, in this analysis an interest charge of 6% on operating expenses is incurred for a period six months out of each year of analysis. This is assumed to account for the costs of maintaining sufficient working capit Tree Yields Yield expectations per tree in generalized Florida growing conditions are summarized from published data. The Florida Agricultural Statistics Service (FASS) division of the USDA has calculated average yield by tree age, variety, and region of Florida (Ind ian River, North & Central, West, and South) since 1993. The USDA derives the average yield per tree by using the of season field samples of production per tree by age (Florida Agricultural Stat istics 2006). Appendix Table B13 summarizes the FASS data by tree age and region. At the time of writing, the state average yields by tree age over the 2000 2005 period are available, but were not used because they are lower than previous periods due to the effects of the 2004 5 Atlantic Hurricane Season, especially for the Indian River and Western regions. Since 1960, the Savage yield tree age study Savage study ma y no longer be applicable due to its limitation to ridge groves and low density plantings (48 to 70 trees per acre). More recent studies by the researchers at the University of Florida IFAS track box and juice yield by tree age in higher density plantings at both ridge and flatwoods sites. A study of Valencia oranges on twelve rootstocks by Dr. William Castle tracks box and juice yields by tree age over a 15 year period in both ridge (Avon Park) and flatwoods (Indiantown) locations (details in Appendix Ta ble B14, Castle 1994). The findings indicate a trend in high density plantings in that production per acre reaches a maximum and plateaus

PAGE 31

31 earlier, around year 10 or 11 of tree age, than trees with wider spacing. This is due to trees competing with each o ther for sunlight, water, and nutrients (Parsons and Wheaton 2006). Fortunately, the reduced per tree yield is compensated by a greater number of trees for comparatively more production per acre. Another study of high density (150+ trees per acre) flatwoo ds plantings at theUF/IFAS Southwest Florida REC examined Valencia and Hamlin oranges primarily on Carrizo and Swingle rootstocks and confirms the plateau of box yields around 8 to 10 years of age. Moreover, a comparison of the Valencia and Hamlin orange varieties shows that Hamlins produce between 100 and 120 boxes per acre more than Valencias. (Roka et al. 2000) Additionally, while Hamlins produce less pounds solid per box, Hamlins annually out produce Valencias by 200 to 800 pounds solid per acre. 2 Po unds solid per box varies due to various biological and environmental factors, and also depends on variety and rootstock. In addition to the quantity of pounds solid per box, the quality of juice is important. Juice with a good color and a sufficiently h igh sugar to acid ratio (Brix ratio) receives a premium from juice processors. Late season Valencia oranges usually exhibit better juice quality than early season Hamlins, and the price per pound solid for Valencias are generally higher than the price pai d for Hamlins (Spreen et al. 2001). Varieties grafted to rootstocks such as Carrizo, Sour Orange, and Swingle tend to give higher pounds solid than 2 Po unds solid is very important for oranges sold for juice processing because growers are paid on the basis of the pounds solid measure of juice quantity and not the number of boxes. While a box of oranges always weighs 90lbs, the quantity and quality of jui ce that can be squeezed from the fruit varies. Orange juice contains water, sugar, and a diverse range of other organic molecules. Sugars constitute about 75% of the dissolved solids in orange juice, and are directly proportional to the quality of the ju ice. The density of the dissolved solids in the orange juice is measured in degrees Brix, named after the German scientist who discovered how to measure this relationship. Degrees Brix is converted into the percentage of soluble solids in the juice and m ultiplied by the amount of juice squeezed per box to arrive at the number of pounds of solids (abbreviated to pounds solid or p.s.) per box of oranges.

PAGE 32

32 Rough Lemon and Volkameriana (Jackson and Davies 1999 Castle 1994). When interpreting the results of this analysis, it is important to remember these differences in breakeven prices. The preceding sources were used to construct an average box and pounds solid yield per tree by age for this analysis. Differences in topography, soil, climatic conditions, and g rove care all play a role in the yields of a particular grove; however these yields are assumed to control for random effects and represent what a grower can expect from a healthy, well managed tree. Therefore, the above information was adjusted with the opinion of IFAS experts to reflect the expected average yield of a typical Florida grove using standard grove care techniques (Muraro 2006 d ). Unfortunately, no detailed studies of grapefruit yields exist; instead an approximation of the state average yiel ds for colored grapefruit is used and adjusted for higher densities. Pounds solid are not calculated for grapefruit because it is assumed that grapefruit is produced for the fresh market. The analysis yields also incorporate a resetting effect due to the resetting of only half of the total tress lost after year 10 of grove age, which makes more space available for each tree. The maximum yield in year 10 was increased by 10% for years 11 15 due to trees growing out into the wider spacing.

PAGE 33

33 CHAPTER 3 ACCOU NTING FOR THE EFFECT S OF CITRUS CANKER A ND GREENING ON FLORIDA COMMERCIAL C ITRUS PRODUCTION The Florida citrus industry currently faces two new disease challenges with unpredictable consequences. Citrus canker is a bacterial disease of citrus that causes unsightly lesions on citrus leaves and affects tree productivity. Citrus greening, or Huanglongbin g (HLB), is a bacterial disease of citrus that quickly kills trees. Both diseases are highly contagious and have the possibility of spreading rapidly throu gh commercial production areas of the state. Under the canker eradication program, any tree detected with citrus canker was required to be eradicated, along with all other trees within a 1900 foot radius. Growers were compensated by the USDA Animal and Plant Health Inspection Service (APHIS). This program was halted in January 2006, and the management of canker is now the responsibility of individual growers. In August of 2005, citrus greening was first detected in a residential citrus tree near Homest ead in Dade County, and has spread to all of other citrus producing counties. The Florida Department of Agriculture and Consumer Services (FDACS) made it known that there will not be a greening eradication program. Florida commercial citrus production is entering an environment of endemic citrus canker and greening. Due to the novel nature of these challenges to citrus production, this analysis surveys current academic literature on these diseases in order to describe their grove level effects on citrus. Citrus Canker C anker bacteria are spread by windblown rain, human and mechanical contact. It enters the citrus tree through natural openings and wounds in the protective outer tissue of the trees, and is exacerbated by the citrus leafminer insect. Dep ending on weather conditions, canker symptoms appear from about a week to a couple months after infection, and are especially virulent in hot and humid weather. Severe infections may cause defoliation, badly blemished

PAGE 34

34 fruit, premature fruit drop, and tree decline (Schubert and Sun 2001). Studies suggest that the canker bacteria can be spread over two miles from normal wind and rain alone, with longer distances of 10 miles and greater possible due to hurricanes and other severe weather events (Gottwald et al. 2002a). eradicated until 1933. Canker is hypothesized to have arrived in Florida on plant material imported from Japan (Gottwald et al. 2002 II). After 53 years, c anker reappeared in Manatee county in 1986, and after an extensive eradication program, it was declared eradicated in 1994. The next year, canker reappeared in a residential citrus tree near Miami airport, and was the focus of the most recent eradication program. From 1995 onwards, citrus canker was subject to an eradication program which until 1999 destroyed all trees within a 125 ft. radius of an infected tree. In 1999, a new study showed that canker was spread much farther than previously thought, and a 1900 ft. radius of eradication was mandated, plus any cleared land was required to be left bacteria spread within 30 days. According to a USDA study, Hurrican e Wilma in 2005 may have exposed 168,000 to 220,000 acres of commercial citrus to canker, in addition to the 80,000 acres already exposed by the 2004 Hurricanes Charley, Francis, and Jeanne (FDACS 2000a). Approximately 7.5 million commercial trees, 860,000 residential trees, and 4.3 million nursery trees were eradicated from 1995 until the end of the program. Canker finds are now reported in all of the top twelve citrus producing counties. (FDACS 2006 II) With the halt of the citrus canker eradication pr ogram, canker will now likely become endemic to Florida for the first time in the history of the industry.

PAGE 35

35 The effects of canker in a citrus grove depend on the susceptibility and market outlet of the fruit. White and colored grapefruit, Persian (Tahiti ) limes, and early and midseason oranges (especially Navel and Hamlin varieties) are the most susceptible citrus varieties. Valencia oranges, tangelos, and tangerines appear to be less susceptible to canker (Gottwald et al. 2002 b ) Canker does not affect the juice quality of fruit, but the unsightly canker peel blemishes and quarantines against fresh fruit shipments from canker infected areas lead to the conclusion that the profitability of fresh market citrus will be impacted more severely than citrus fo r juice processing. Studies of citrus production in certain areas of Brazil and Argentina where canker is endemic suggest guidelines for specific integrated management programs for the control of canker in a grove (Leite and Mohan 1990, Spreen et al. 2001 a, Muraro et al. 2001). Tree Loss and Yield Reduction Due to Canker Canker has not been conclusively shown to kill trees in the short and medium term, but a severely infected tree may become unproductive, and serves as a source of inoculum (bacteria) that can be spread to neighboring trees. An integrated management program includes removal of infected trees and some neighboring ones. This analysis assumes an increase of 10% in historical tree loss rates for all age categories. The hurricane seasons of 200 4 and 2005 not only spread canker through commercial groves but affected large numbers of citrus tree nurseries. As of 2004, 70% of Florida citrus rain spread canker. Canker eradication destroyed nearly two thirds of the existing nursery tree inventory, and eliminated important sources of budwood for propagating new trees (Spreen et al. 2006). Few nursery trees were available for the next two years, with limit ed production for the

PAGE 36

36 next three to five years. This analysis uses a figure of $7.50 per tree to account for increased price due to decreased supply during the next 2 5 years. Infected trees exhibit twig dieback and leaf, flower, and fruit drop (Gottwald 2006 II). Hamlin oranges with endemic canker indicates possible yield losses of 10 20% for highly susceptible varieties (Spreen 2001). This analysis assumes a yield penalty of 10% for Hamlin oranges and grapefruit. Valencia oranges are considered moderately susceptible, and are assessed a lower yield penalty of 5%. Canker Managemen t: Augmented Spray Programs Canker increases the cost of spray programs for the most susceptible varieties, especially grapefruit for the fresh market. Studies show that copper sprays reduce the canker inoculum (bacteria) build up on the leaf and fruit s urfaces of infected trees, with 3 5 annual sprays for moderately susceptible varieties and 4 6 for highly susceptible varieties (Gottwald 2006b). The citrus leafminer insect is currently under somewhat successful biological control, and also is controlled for by oil based spray applications (Heppner 2003). For the purposes of this analysis, it is necessary to determine the additional spray material and application costs canker adds to standard spray programs. Copper spray is already widely used as a fun gicide/bactericide in Florida to control for melanose, greasy spot, and scab, especially for the fresh market (McCoy et al. 2005). Petroleum based oil sprays are also used extensively to control for insects such as scales, and other diseases. Many of the se sprays can be mixed together, and applied at the same time. Upon consultation with IFAS Lake Alfred CREC experts, additional spray applications, schedules, and costs were determined for canker control

PAGE 37

37 ( s ee Appendix Table B 17). Valencia and Hamlin ora nges for the processed market, and grapefruit annual spray costs are expected to increase $20.96, $48.17, and $35.26 per acre, respectively. Canker Management: Field Inspections Aggressive field inspections and decontamination of workers and grove equipm ent to identify canker sources and control its spread are a vital part of the canker management program. Three yearly field inspections by trained personnel were estimated at $5.84/acre/inspection (Muraro 2006d) This cost was calculated for a 120 acre g rove, using nine inspectors and two vehicles, and may vary depending on the size and location of the grove. Canker Management: Windbreaks Windbreaks are densely planted stands of large trees not susceptible to citrus canker planted along the borders of a grove or block of citrus. The intent is that the protection of the trees will stop or deflect the spread of windblown canker for outside sources. This has proved successful in Argentina and Brazil for protecting groves, and is a likely part of an integra ted canker management program, especially for fresh market fruit (Leite and Mohan 1990) The annual cost used in this analysis for establishing and maintaining a windbreak is estimated to be $11.47/acre for a 10 acre block over 20 years, and in this analy sis is only included for grapefruit. There may be additional costs due to lost production from the reduction in grove area planted in citrus and the shading out of existing trees that are not included in this analysis ( s ee Appendix Table B15 for a detaile d breakdown of costs and additional information). Canker Management: Packinghouse and Export Certification for Fresh Market Citrus Fresh fruit must be handled in designated packinghouses where fruit is treated with disinfectants, and some processing plant s and packinghouses refuse to accept fruit from infected

PAGE 38

38 groves. In the future endemic canker environment, packinghouses are expected to pass along the cost of special handling to growers. This analysis assumes $.10 per box (or $40.50/acre @ 450 boxes/ac re) based on conversations with industry professionals and academics. Moreover, it is likely that the DPI will require special inspections for groves exporting internationally, and this cost is estimated at $60/acre. In the analysis, these costs are only incurred for fresh market grapefruit after the trees become commercially harvestable at three years of tree age. Citrus Greening Citrus greening or Huanglongbin (HLB) is a bacterial disease of citrus native to Asia. Greening (bacteria species name: Cand idatus Liberibacter) gets its name from the small, green fruit produced by an infected tree. Infection causes the quick decline and death of a tree in about two to four years. After its initial detection in August of 2005 in Homestead, greening has sprea d throughout the state. Greening is spread by an insect vector named the Asian citrus psyllid which is widely distributed throughout the state and is difficult to control. The exotic nature of greening in Florida and lack of a definitive management prog ram means there is very little information about the effects of greening on the production and costs of a grove. Greening has devastated the citrus industries of other countries, but little is known about how greening will behave in the intensive grove ma nagement environment of Florida. Most existing literature on greening is found in scientific journals specializing in virology or plant pathology. As of this writing, there exist only two studies of the economic impact of greening (Grezebach 1994 Roista experiences with greening serves as the basis for the assumptions reached below, and may not reflect the realities of greening in Florida.

PAGE 39

39 Literature Survey of In ternational Experiences with Greening transmission was spread by propagation with infected material and the psyllid vector. In a field study with .78 Ha (240 tangerine trees) in a greening endemic area with no control, psyllid infestation was found five months after planting, with 89% of trees infected within eight months after the infestation was discovered (Chen 1998) Trees expressed symptoms of greening an d dieback approximately two and one half years after the initial infection. A greening like disease (CVPD) was first discovered in Indonesia in the 1950s, and was present in most major production areas by a 1984 survey (Vichtranada 1998) With an integrat ed pest management program (IPM), yields increased 200% in certain areas. A Vietnamese survey conducted in 1995 found greening in all citrus production areas of Vietnam, and it was observed that four to seven year old trees were particularly damaged. A field study of ten hectares at six sites (tangerines and oranges on trifolia te and volkameriana rootstocks) showed that disease free trees planted in greening endemic areas, with limited psyllid control suffered a re infection rate of 16% to 100% (Hong 1998). The lowest rate was attributed to a long proceeding fallow period. Bef ore infection, the orange trees yielded 220 boxes per acre, and after infection only 43 boxes per acre.

PAGE 40

40 Figure 3 1. Indonesian citrus production, 1975 2005 In Thailand, greening had a devastating impact on commercial tangerine production, and reduced average tree life expectancy from eight to ten years with a 10% to 15% annual death loss. The use of air layering (marcotting) for propagation and limited insect control programs ighest tree loss was for one to two year old trees, with tree death by three to four years. It was observed that newly infected trees were usually found clustered in the front row of the block adjacent to nearest previously infected block of citrus. In a field study with spray program in endemic greening and canker area, spraying at 7 day intervals with copper oxichloride mixed with methamidophos, carbosulfan, imidaclopid, and methomil resulted in no infections (Vichitrananda 1998).

PAGE 41

41 Figure 3 2. Thai citrus production, 1975 2005 The South African strain of greening was first observed in the 1920s, with an estimated 60% of all South African citrus trees infected by 1970. Greening eliminated citrus production in the Transvaal an d Natal provinces. Due to the implementation of a successful IPM program, commercial production is returning to some areas previously abandoned because of the effects of as follows : Resetting in mature groves with history of greening is not recommended Trees less than five years old are eradicated with any sign of greening Trees five to ten years old are eradicated if 75% or more of the canopy shows signs of greening, infected branches are prun ed otherwise Ten or more year old trees are not commonly eradicated, but branches with greening are pruned Coordinated psyllid spraying among adjacent groves (Buitendag and Von Broembsen 1995) SOURCE: FAOSTAT 2005

PAGE 42

42 Figure 3 3. South Africa citrus production, 1975 2005 Projected Florida Tree Loss Due to Greening Given international experiences with greening and the preference of psyllids for new growth, the tree loss rate is expected to be proportionally higher for young trees. While the exact impact of greening on trees by age has not been studied, this analysis assumes a range of possible tree loss due to greening, given by three scenarios: Low, Medium, and High tree loss. The statewide historical loss rate is increased by t he following amounts, and the annual tree loss rates are summarized in Table 3 1 Table 3 1 Tree l oss p ercentages u sed in a nalysis TREE AGE BASE* GREENING CANKER Low Med High 1 3 1.00% 2.00% 2.50% 4.00% 1.10% 4 11 1.50% 2.63% 3.00% 4.50% 1.65% 12+ 3.50% 5.25% 6.13% 8.75% 3.85% Estimated average state historical tree loss (excluding effects of development and eradication) SOURCE: FAOSTAT, 2005

PAGE 43

43 Greening Management: Psyllid Control The psyllid insect vector of greening is difficult to control because the psyllid population spikes at certain times of the year, exhibits continuous movement between citrus trees and surrounding host vegetation, and has a wide range of other host plants besides citrus. Moreover, its small size and recent arrival to Florida makes it d ifficult for growers not familiar with the insect to discover its presence in the grove. Psyllids feed almost exclusively on new growth flushes, and adult psyllids are able to acquire and transmit greening within 24 to 48 hour s (Buitendag and Broembsen 19 92). The importance of a coordinated psyllid IPM was illustrated in Indian field tests that found that 67% of certified greening free trees were infected three years after planting if greening was present on adjoining properties (Azzaro et al. 1993). Chi nese researchers successfully eliminated all greening incidents by the eradication of all backyard citrus and other host plants in area, the use of windbreaks, the planting of certified greening free trees, the application of ten to thirteen psyllid specif ic sprays per year in flush periods, and the prohibited introduction of any host plants in general area (Ke and Xu 1990). Another Chinese study tested the possibility of rehabilitation of an infected grove by pruning all infected branches and applying 10 to 13 psyllid specific sprays per year. This resulted in reducing new infections from 2.5% to 1% over eleven years in one location, and 7% to 1% over nine years in the other (Xu et al. 1991) Moreover, ten to twenty psyllid specific sprays per year does not appear to be feasible for both economic and environmental reasons. From the international experience with greening, a South African study of different psyllid control programs found that: Multiple sprays aimed at maintaining low populations of psylla t hroughout the spring, summer, and autumn periods were impractical and caused pest repercussions. It was then realized that systemic treatments targeted specifically at psylla and applied either to the stem or to the roots would be most effective (Buitenda g and Von Broembsen 1992)

PAGE 44

44 Experiments in psyllid control in Florida have shown that foliar applied insecticides such as Danitol, Lorsban, and petroleum oils are useful for short term control of spikes in psyllid populations, while foliar or soil applied s ystemic insecticides such as Provado, Temik, and Admire are useful for long term control. Admire is used on young, non bearing trees, and Temik is used on older, productive trees (Rodgers 2006). To augment the standard citrus spray program, this analysis assumes annual Temik or Admire applications in their maximum allowable amounts, plus one additional Danitol and Lorsban application per year. This results in a cost increase of $203.00/acre for oranges on the Ridge, $194.36/acre for oranges on the Flatwo ods, and $156.74/acre for grapefruit, added to the existing grove spray program results in the chemical costs shown in Appendix Table B17. The grapefruit for fresh market costs do not increase as much as the oranges for processing because of the ability t o combine greening spray applications with the existing spray program. Greening Management: Grove Inspections psyllids and infected trees. Infected trees should be eradi cated immediately, and psyllid populations controlled promptly to avoid a quick spread throughout the grove (Brlansky 2005). This analysis assumes that growers must inspect six times per year. Using the same cost components as the canker inspection progr am described above, the annual cost of greening inspections is $35.04/acre. Combining the Effects of Canker and Greening To account for the combined effects of canker and greening in a grove, the above cost categories, yield, and tree loss assumptions are added together and overlaps, particularly in the spray programs are subtracted. A comparison of spray programs with different disease scenarios

PAGE 45

45 is shown in Appendix B Table B 17, while a detailed production budget of different groves and varieties with both canker and greening is illustrated in Appendix B Table B18. Inspection costs are assumed to be the higher figure for eight annual inspections ($35.04/acre) for both canker and greening. The canker yield penalty is included (5% for Valencias and 10 % for Hamlins and grapefruit), and the medium greening tree loss rate is assumed. Table 3 2 Annual p er a cre s pray c osts by d isease s cenario Scenario Ridge Flatwoods Valencia Hamlin Valencia Hamlin Grapefruit Base $137.06 $137.06 $141.19 $141.19 $383.18 Canker $153.20 $189.36 $153.20 $189.36 $418.43 Greening $335.55 $335.55 $335.55 $335.55 $539.91 Canker & Greening $335.55 $371.71 $335.55 $371.71 $539.91 Source: IFAS 2004 5 Citrus Production Budgets adjusted for BMP disease spray programs

PAGE 46

46 CHAPTER 4 A NET PRESENT VALUE MODEL OF A FLORIDA C ITRUS GROVE The definition of an investment used in this analysis is the ownership of an asset that has value. The value of an asset is created by intrinsic value and/or the value of the income it may produce. Unless this asset is inherited or received as a gift, the ownership of the asset must be purchased with another asset of value. In this analysis, value is framed in monetary (dollar) terms. The preferred goal of an investment is to capture a re turn that is in excess of what it costs to obtain the asset. In the case of an investment in a citrus grove, initial costs are incurred in the purchase of the land and establishment of the trees. This is based upon the expectation of creating value from t he future income from the production of the fruit and the ownership of a productive grove. Due to the long life of a productive grove, it is necessary to determine the value of the future production and ownership currently to compare it to the costs that are incurred now. Net present value analysis is a means of comparing the future expected returns to ownership of a citrus grove to the current cost of acquiring it. A citrus grove is a dynamic enterprise where yields, revenues, costs, and grove value chan ge through time depending on tree age, tree loss, fruit prices, and input costs. This analysis adapts a mixed age grove model to reflect grove operating costs and revenues. This mixed age grove model captures the evolution of costs over time, including t he costs of tree loss, resetting, and caring for replacement trees. Both box and pound solids yields increase with tree age, and with resetting it is necessary to capture the effect of a mix of tree ages on total grove yields. Accounting for trees of dif ferent ages within a grove becomes even more important when higher

PAGE 47

47 mechanics are given below, but the reader is referred to Appendix C for results generated by the model for a Valencia orange grove in the Central Florida ridge production area. Net Present Value Theoretical Framework Net present value (NPV) is a frequently used way of evaluating and comparing investments, also known as capital budgeting in the finance literature. A 2001 survey of 392 chief financial officers for business ranging from small private business to Fortune 500 public corporations found that around 75% use the NPV method of project analysis (Graham and Harvey 2001). Around 50% of firms used sensitivity and scenario analysis methods. This study borrows commonly used investment analysis techniques of NPV and scenario analysis from the corporate finance field, and adapts and applies it to citrus growing in Florida. Present Value Investment Rule NPV begins with the assumption that the value of a dollar received today is worth more than a dollar received tomorrow because a dollar today can be used or invested. Determining the present value (PV) of future payments or cash flows requires a meth od to discount their future value by the perceived opportunity cost of waiting for them. Cash flows in consecutive future periods that are discounted by the same rate sum up to form the present value. The series of present values are additive and the disc ount rate compounds in a geometric sequence where it is raised to the power of the future time period. Consider the below case of three yearly cash flows discounted at a rate of 10% per year. 4.1) PV = 100 + 100 + 100 (1 + 10) 1 (1 + .10) 2 (1 + .10) 3 = 100 + 100 + 100 1.1 1.21 1.33 = 90.91 + 82.64 + 75.13 = 248.68

PAGE 48

48 The generalized formula of the sum ( ) of the present v alues of the cash flows (CF) in future time periods (t) is represented by the following: where CF t is the current value in period t and r is the interest rate. Net present value (NPV) adds the initial cash flow to the present values of future cash flows. NPV is used to adapt the present value framework to the reality of most investments. Usually, the initial cash flow is a negative outlay used to acquire an asset assumed to be purchased now, and therefore is not discounted. 3 When investing in an asset, the investor is foregoing the return available by investing in another asset. The discount rate (r) is a method to incorporate the opportunity cost of choosing an alternative investment, and establish a required rate of return for investing in the asset. This gives two equivalent decision rules for capital investment: Net Present Value Rule. Accept investments that have positive net present values. In other words the difference between the present value of future income minus the cost of aquiring the investment is a positive number. 3 This analysis will use the cash flow sign convention of expenses are negative cash out flows ( ) a nd income is a positive cash out flow (+). T (4.2) PV = (CF) t t=0 (1 + r t ) t T T (4.3) NPV = (CF) t + CF 0 or (CF) t Init ial Investment t=0 (1 + r t ) t t=0 (1 + r t ) t

PAGE 49

49 Rate of Return Rule Accept investments that offer rates of return in excess of their opportunity costs of capital, or the rate o f return of the investment exceeds the rates of return on similar investments. Alternative Investment Rules Three traditional alternatives to the NPV investment decision rule are the book rate of return, payback period, and internal rate of return (or hurdle rate) (Brealey and Meyers 2003). These rules are commonly used and may lead to misleading conclusions and incorrect decisions based on their results. It is important to remember that NPV depends only on forecasted cash flows and the discount rate or opportunity cost of capital. Book income is another name for accounting income, and it used to determine the book wn on the balance sheet. Both are reported using accrual accounting methods which may not reflect actual cash inflows and outflows. The book rate of return is the basis for ratios such as the return on assets (ROA) or return on equity (ROE). Accounting procedures sep a rate cash outflows into capital and operating expenses. Capital expenditures are depreciated and debited against income according to a schedule that may not reflect the actual cash flows; also, the allocation of capital and operating expenditures is usually project or i nvestment basis. When evaluating a capital investment decision, it is important to remove the distortive effects of the choice of accounting methods from the actual value of the investment; however, there are benefits to tax, depreciation, and financing c hoices. Elsewhere, this analysis includes a framework for how to calculate these ancillary benefits. (4.4) B ook rate of return = Book Income or Book Income Book Assets

PAGE 50

50 The payback method is an investment rule which specifies the number of years it should take for the cumulative discounted cash flows (DCF) of an investmen t to pay back the initial investment expenditure. Graham and Harvey (2001) found that the payback method was predominantly used by smaller firms. The payback method is another way to account for hen evaluating competing projects, the project with the shortest payback period is selected. First, this method ignores cash flows after the payback or break even date. An investment may create significant value after the establishment of an arbitrary cu toff date. Second, the payback method is biased towards investments with large cash flows early in their lives. Longer lived investments may generate significantly more returns on a DCF basis. The internal rate of return (IRR or IROR) is an investment ru le related to the NPV rule, where the rate of return from discounted cash flows is compared with the discount rate or returns to investment must exceed for a fi rm to invest. Therefore, if the return of the discounted cash flows is greater than the cost of purchasing the investment, a firm will choose to invest. By definition IRR is the discount rate which makes the NPV equal to zero, and is found by substitutin g IRR into the NPV formula and solving. (4.5) NPV = (CF) t + CF 0 = 0 t=0 (1 + r) t T (CF) t 1 = IRR t=0 CF 0 Or NPV = CF 0 + CF 1 + CF 2 CF t (1+IRR) 1 (1+IRR) 2 (1+IRR) t

PAGE 51

51 The IRR illustrates the important aspect of NPV which is its inverse relationship to the discount rate. As the discount rate increases, the present value of future cash flows d ecreases and NPV becomes smaller. This relationship can be represented by the downward sloping line shown in Figure 4.1. Where the line crosses the discount rate axis is where the NPV of an investment is equal to zero. That rate is the IRR, in this case 35%. The IRR must be compared to the discount rate to either accept or reject the investment. For example, if the discount rate (r) is 20%, the opportunity cost of capital is less than the internal rate of return to the investment (IRR) of 35%, and the NPV is +$1,200. Therefore, the investment will be accepted. If the discount rate (r) is 65%, the opportunity cost of capital is greater than the IRR (35%), and the NPV is $1,000. Therefore, the investment will be rejected. Figure 4 1. Relationship of NPV and IRR The IRR is a polynomial equation for multiple periods, has no unique solution, and must be solved numerically through interpolation to find an accurate value. Fortunately, this c an be done instantly through the use of spreadsheet based computer programs or financial calculators. The IRR method will give an inaccurate figure if there a re changes of signs in the cash flow, or +2,000 +1,000 1,000 2,000 Discount Rate (%) Net Present Value ($) 25% 100% 75% 50% IRR = 35% r = 20% NPV=+1,200 r = 65% NPV= 1,000 0

PAGE 52

52 crosses the discount rate axis more than one time. The IRR is calculated in citrus grove investment analysis because it can be useful in some situations to compare the profitability of an investment to its opportunity cost, but NPV is a more reliable measure of value over time and an absolute measure of the total value created. Adapting NPV to Citrus Investment To adapt the NPV framework to a citrus investment, it is first necessary to construct the cash flows. In its most basic form, the cash flow to growing citrus is a functio n of yield, price, and cost. In each period there exists a yield of fruit which is multiplied by the price for the fruit minus the operating cost. The first period (period 0) is typically referred to as the initial investment. This is the cash out flow necessary to acquire the grove whether it is the purchase of a mature grove or the cost for establishing a new or replanted grove. In this analysis, it is necessary to distinguish two indexing variables of time (t) and tree age (a). Time is the analysi s time which starts in year 0 (present day) and moves forward 15 years or periods. This is distinct from tree age (a) which will change depending on the beginning age distribution of the grove and amount of tree loss incorporated into the model. Yields and costs change with time, tree age, variety either canker or greening, and is separated from normal tree loss in a grove. Price (P) is treated as an exogenous variable and is used to measure the effects of changes is yield and cost due to disease.

PAGE 53

53 Exiting the Investment: Bond Valuation, Perpetuities, and Terminal Value The additive property of present value makes it an attractive method for determining the value of an asse t with a long series of future cash flows. Although, one must determine a cash when the asset has a very long or indefinite life. A well maintained citrus grove is usually expected to last at least fifteen years to thirty years, and may last much longer. A grove owner expects that the grove will retain a terminal value as an income producing property after the expected life of the grove due to its suitability t o be replanted in citrus. This creates an issue of how to determine the present value of all the future returns accruing to ownership of a grove. The method of valuing of one of the most basic financial instruments, the bond, illustrates a path to valuin g a citrus investment. A fixed coupon bond is a debt instrument similar to loan where the holder of the bond is entitled to a fixed series of interest payments (coupons) until the bond matures at a specific date and the holder receives the face value (pri ncipal) of the bond. The bond can be viewed as two investments, and discounted separately. The value of the bond (or a citrus inv estment) depends on the coupon payments (income), the principal (value of investment), the time to maturity (expected life of the grove), and the (4.8) PV(bond) = PV(coupon payments) + PV(principal) (4.6) CF 0 = Initial Investment (4.7) CF t = P Y t C t t = analysis time period a = tree age V = tree variety

PAGE 54

54 value of other similar bonds (opportunity cost of capital). The total number of coupon payments throughout th e time to maturity is discounted at the opportunity cost of capital, plus the final payment of principal at maturity, is also discounted. If the sum of the present values of the coupon payments and the principal is more than the purchase price of the bond then the NPV is positive. Changes in the purchase price of a bond are related to the rates of return of other assets and perceptions of risk; however, a citrus investment does not pay a fixed income over its life nor will return a fixed amount upon matu rity. Therefore, the valuation method must include a way for determining a grove final value. As previously stated, the present value calculation has the property of being a geometric series which compounds the discount rate by raising it to the power of the time period. This makes the value of future cash flows logarithmically smaller the farther out into the future, up to the present value of $100 at infinity which is zero. Table 4 1 Discounting e xample Discounting $100 @ 10% Year Discounted Amount 1 90.91 2 82.64 3 75.13 .. .. 15 23.94 .. .. 30 5.73 The value of an infinite series of equal future cash flows, called perpetuity, is a useful way of determining an asset of indefinite life. The formula is derived by simplifying the present value series to:

PAGE 55

55 (4.9) PV of perpetuity = Annual Cash Flow (CF) Annual Rate of Return An extension for a perpetuity with constant growth (g) of cash flows into infinity can be accounted for by the Gordon Growth Model: (4.10) PV of g rowing perpetuity = Annual Cash Flow (CF) Annual Rate of Return Annual Growth Rate Valuation of an asset with an indefinite life span is usually calculated by determining the present values of cash flows out to a certain planning horizon, and adding the for e casted value of the asset at the horizon, also discounted back to the present value. Determining a Discount Rate for the Citrus Investment The NPV approach is based on the use of an appropriate discount rate to adjust future cash flows by their opportunity costs. The opportunity cost can be viewed in two ways, a firm specific and a generalized manner. This analysis uses th e generalized case, but the appropriate firm specific discount rate is explained below. The weighted average cost of capital (WACC) is defined as the opportunity cost of the financing source for the project being evaluated. WACC is usually a firm specific measure, and traditional sources of financing, debt and equity, and gives the real cost of financing the given { } (4.11) NPV = CF 0 + CF 1 + CF 2 CF t + Avg. Annual CF (1+r) 1 (1+r) 2 (1+r) t Annual Rate of Return (1+r) t PV of ongoing business as a perpetuity at forecast horizon

PAGE 56

56 project. The after tax WACC adjusts the debt comp of debt (interest expenses) from its taxable income. WACC is usually calculated on a project specific basis, and not firm wide. The WACC used to discount a specific project should be evaluated for the debt/eq uity financing mixed used to expand that project. (4.12) WACC = (% of project financed by debt) (cost of debt) + (% of project financed by equity) (expected return on equity) Or = r d (D/V) + r e (E/V) Wh ere r d = cost of debt, r e = required return on equity, D = amount of debt, E = amount of equity, and V = Book Value of project (4.13) AFTER TAX WACC = r d (1 T c )(D/V) + r e (E/V) where T c = marginal tax rate The generalized risk adjusted discount rate is based on a study of returns to different citrus varieties conducted by Moss, Weldon, and Muraro (1991). That study uses a capital asset pricing model (CAPM) similar to valuing the risk of tradable securities to compare returns of different citrus varieties to an index constructed of the returns from a weighted portfolio of all citrus varieties. The CAPM model is based on the idea that similar factors (such as supply and demand) affect all citrus varieties, but not to the same extent. The CAPM incorporates the risk of a specific citrus variety compared to a diversified portfolio of all other citrus varieties to quantify its performance in relation to other citrus investments. This share of variance a specific variety has in common with oth i ) in equation 4.4. Beta is then multiplied by the difference between returns to the citrus portfolio and a risk free rate of return. This captures the relationship of the risk of owning a specific variety of citrus to the returns for all Florida citrus. For instance, if returns to growing oranges for processing increase, prices for Hamlin, Pineapple, and Valencia oranges will all increase, but by different amounts.

PAGE 57

57 This risk adjustment is added to the return on a r isk free alternative investment to arrive at the risk adjusted discount rate (RADR). The variety specific risk adjusted discount rates used in this analysis are shown in Table 4.2. (4.14) i i f 2 f i f = Covariance of citrus vari ety with market portfolio of all varieties 2 f = Variance of market portfolio (4.15) R i = R 0 + i (R m R 0 ) Where, R i = Risk adjusted rate of return on citrus variety (i) R 0 = Risk free rate of return R m = Return on market portfolio Table 4 2 Risk a djusted d iscount r ates by v ariety Beta Risk Adjustment* RADR Early/Midseason Oranges 1.3870 0.0299 0.0824 Valencia Orange 1.9017 0.0409 0.0934 Colored Grapefruit 0.8961 0.0193 0.0718 Risk adjustment is based on an average return to the market portfolio of .0743 and a risk free rate of .0525 Source: Moss, Weldon, and Muraro (1991) In addition to the risk adjusted discount rate, citrus investments are also subject to a liquidity premium, and cost of money mana gement premium. The premiums are taken from an unpublished analysis by Ronald Muraro at IFAS Lake Alfred CREC (Muraro 2006d). A citrus investment is illiquid in the sense that it cannot be sold quickly without significant transaction fees and reduction i n sales price. In this case, the liquidity premium is taken as the difference between a 90 day U.S. Treasure Bill and the 30 year Treasury Bond, 0.55% at the time of writing. The cost for money management premium reflects the additional work and energy r equired to manage agricultural investments compared to other investments. The overall discount rates by variety used in this analysis are shown in Table 4 3.

PAGE 58

58 Table 4 3 Discount r ates u sed in c itrus i nvestment a nalysis Valencia Hamlin Red Oranges Oranges Grapefruit Risk Adjusted Discount Rate 9.34% 8.24% 7.18% Add: Liquidity Premium 0.55% 0.55% 0.55% Difference between 3 Month Treasury Bills and 30 Year Bonds/January 2006 Cost of Money Management 2.00% 2.00% 2.00% Most investments Range from 1% to 2%; Sometimes agriculture is higher. Total Discount Rate 11.89% 10.79% 9.73% Say: 12.0% Say: 11.0% Say: 10.0% Determining an Appropriate Terminal Value for a Citrus Investment The value of a Florida citrus grove can best be separated into two components: the value of the current and future income from fruit production, and the value of the underlying land. As shown by the bond example for valuing a long lived asset, any analysi s must determine a terminal value for all future returns to the grove after the final period of analysis. The most realistic and accurate ending value would be the sales price of a particular grove at that future point in time given that the sales price r expectations on the future income of the grove and the underlying land value. Unfortunately, determining the value of the underlying land depends significantly on the particular characteristics of location, soil, demand, and highest and best use of the land that are beyond the

PAGE 59

59 scope of this analysis; however, information exists about grove income and we can arrive at a reasonable approximation of a terminal value to include in this analysis. The valuation (o r appraisal) of land and real estate property is commonly divided into three analysis approaches that are subsequently compared to determine a fair market value for the property (The Appraisal Institute 2001). First, the extraction or cost approach values the replacement or reproduction cost of structures and improvements to land given that the utility of the structures or improvements can be exactly reproduced. For agricultural properties, the cost approach is usually not applicable because of the low pe rcentage of the total value of the property that is attributable to structures and improvements (Muraro 1989) Second, the income approach values a property by its income producing potential and converts the value of all future income accruing to ownershi p of the property to a present value through the capitalization rate. This is the main approach this analysis will use. Third, the market or comparable sales approach estimates the value of the property by observing the values of like properties, and adj usting for particular aspects of the sale, such as location, transaction date, land characteristics, and the terms of sale. While the comparable sales approach is only applicable to specific properties, this analysis will use that approach to validate an applicable capitalization rate. The income approach to citrus valuation starts by deriving an average annual expected income from the property, net of grove and operating expenses. This is divided by the sale price of the land to determine a capitalizatio n (or cap) rate. The cap rate can be thought of as the annual return on investment, and is positively related to increases in net income and negatively related to increases in the sales price. Note, the cap rate only includes income, and not changes in t he selling price of the land over time (capital gain or loss). Since this analysis is generalized to a variety of grove circumstances, the actual sale price of the grove is unknown, but is assumed

PAGE 60

60 ating capability. A dollar amount for annual net income is endogenously generated by the model, and rearranging the capitalization formula to equations 4.11 and 4.12, we need only to estimate a capitalization rate for citrus. (4.16) Capitalization Rate = Average Annual Net Income Sale Price of Grove Where: (4.17) Sale Price of Grove = Average Annual Net Income Capitalization Rate Four applicable methods exist for deriving a capitalization rate for citrus (The American Institute of Real Estate Appraisers 1983) financing mix (debt to equity ratio) and the required rate of return on b oth debt and equity to arrive at a cap rate. This method is essentially identical to WACC as explained above. Second, the debt coverage method applies a specified ratio of net operating income to annual debt service (debt coverage ratio) which is usually twice the value of the financed portion of the purchase price to adjust for non payment risk. This is usually specified by a lender. Third, the yield and change method is an ad hoc modification to the band of investment method to account for the growth in cash flows over time as the grove reaches maturity. This method is not applicable when valuing a fully mature grove. Finally, the built up cap rate method compares a citrus investment to its alternatives, and starts with a risk free rate and adds perc entage premiums for different types of risk inherent to citrus. The first two methods depend on a specification of the financing mix, and are therefore cannot be generalized. This analysis selects the built up cap rate method because it enables the compa rison of citrus to other investments, and can be generalized to diverse grove settings.

PAGE 61

61 (4.18) Band of Investment Cap Rate = % Debt Interest Rate on Debt + % Equity Required Return on Equity (4.19) Debt Coverage Cap Rate = % Debt Interest Rate on Debt Debt Coverage Ratio (usually 2) ( 4.20) Yield and Change Cap Rate = Band of Investment Cap Rate + % Chg. in net income + % Chg. in cap gain (4.21) Built Up Cap Rate = Risk Free rate + Price Risk Premium + Liquidity premium + Ag. ris k premium + Management premium T he built up cap rate method requires the estimation of the various premiums described above. The risk free rate of return used is the rate on a 90 day US Treasury Bill. A variety specific price risk premium derived from M oss et al is added. A proxy for credit risk called risk of ownership is added and includes the difference between low risk and medium risk investment grade bonds plus an estimated 2% agricultural risk premium. A cost of money management is added to acc ount for the more intense investment management needed for a citrus investment. The cap rates used in this analysis are shown in Table 4 4.

PAGE 62

62 Table 4 4 Built up c apitalization r ate m ethod u sed in a nalysis Valencia Hamlin Red Oranges Oranges Grapefruit Risk Free Rate 4.54% 4.54% 4.54% Rate used is 3 Month Treasury Bills/January 2006 Price Risk Premium a / 4.09% 2.99% 1.93% Risk of Ownership 3.16% 3.16% 3.16% Difference between average of Corporate Aaa And Baa Bonds and the average of 3 Month and 2 Year Treasury Bills Plus 2% additional risk For agricultural operation Premium for Non Liquidity 0.55% 0.55% 0.55% Difference between 3 Month Treasury Bills and 30 Year Bonds/January 2006 Cost of Money Management 1.50% 1.50% 1.50% Most investments range from 1% to 2%; Total Capitalization Rate 13.84% 12.74% 11.68% Say: 13.9% Say: 12.8% Say: 11.7% a / "The Impact of Risk on the Discount Rate for Different Citrus Varities," Agribusiness, Vol. 7. No4, 327 338 (1991) (Moss, Weldon & Muraro) The respective cap rates were then compared with comparable sales of real groves throughout the state, and were found to be in line with expectations. Note, the comparable sales were taken from the period 1999 to 2004 because more recent sales may show si gnificantly lower cap rates due to intense non agricultural demand for citrus land within the last two years. This was done in order to avoid distortions caused by speculative demand, and arrive at a cap rate representative of the value of citrus land, no t land for future development.

PAGE 63

63 Table 4 5 Comparable Florida g rove s ales This investment model calculates the average net income from the last two years of the analysis, divides the average by the respective cap rate in order to determine the terminal grove value, adds the result back into the year 15 cash flow, and discounts the amount back to the present. The last two years of net income are taken as representative for a stable, mature grove. In certain circumstances under high tree loss scenarios due to disease, the terminal grove value falls below current price s for vacant (pasture) land. To correct for this impossibility, the terminal value defaults to the current price for improved pasture land when this occurs. Adapting NPV Analysis to the Citrus Grove Conceptually, the mixed age tree model is based on a stu dy done by Ronald Muraro at the Lake Alfred CREC for citrus grove rehabilitation and two models from the forestry management literature. Muraro (1985) applied a mixed age grove model to compare rehabilitation of a freeze damaged grove with solidest replan ting. This model compared costs and returns over a 10 year period incorporating different tree ages. Buongiorno and Michie (1980) developed a matrix model of mixed aged Northern Michigan pine trees in a linear programming model to optimize and test sele ctive cutting methods to maximize NPV. In the model, trees move up diameter classes with time, tree loss due to harvesting is replaced with in growth of new trees, Year of Sale Location Description Boxes/acre Price/acre Cap Rate 1999 Central Young/mature grove of early/mids and Valencias 511 7,883 22% 2000 South 10yr grove of early/mids and Valencias 500 8,002 13% 2002 Southwest 12yr grove of Valencias 432 8,096 13% 2003 Central 12yr grove of Valencias 433 8,358 11% 2004 Central Mature Valencia grove 500 7,704 10% Average: 475 8,008 14% Source: Ronald Muraro, IFAS Extension Economist

PAGE 64

64 and a cutting schedule is determined that would result in a sustained yield that maximizes returns in an NPV framework. This model was modified by Boscolo and Vincent (2000) to apply a loss (damage) matrix accounting for young trees damage in the logging process, and tested for NPV maximizing behaviors while overlaying different policy scenario s. The mixed age grove model is best conceptualized as based on a tree age matrix to describe the evolution of the starting number of trees, the tree loss according to tree age, the resetting of dead/unproductive trees, and the loss of reset trees accordi ng to age as the analysis moves forward through time (Figure 4.2). For explanatory purposes, each group of trees of the same age will be referred to as a cohort. The period of analysis is an annual time variable and increases down the columns, and tree a ge increases along the rows. Figure 4 2 Tree age distribution matrix T00 0 T11*L1 R20 T22*L2 R31*L1 T33*L3 .. .. Rt,a 2*La 2 Tta*La Where: Tta = % of original trees per acre in period(t) of age(a) R t,a 2 = % of reset trees per acre in period (t) of age (a 2)* La = (1 % tree loss) for trees of age(a) *note: resets are lagged 2 periods due to the assumption of biennial resetting. AGE DISTRIBUTION MATRIX (A)

PAGE 65

65 Each matrix row is a snapshot of the distribution of trees in each age group during that period of analysis, and would sum to 1 (or 100%) if there were zero tree loss. Each cohort of trees planted in period t move diagonally through the period of analysis. In this example, T 00 represents the starting cohort of trees planted in time zero that are zero years old. As the period of analysis advances one year, the starting cohort of trees (T) becomes one year old, and is now represented by T 11 After one year, some percentage of the T trees is expected to be lost as given by the tree loss rate by age of tree or L 1 T 11 is then multiplied by 1 L 1 to appropriately reduce th e percentage of starting trees. To incorporate the assumption of biennial resetting (replanting dead/unproductive trees every other year), resets (R t 2,a ) are included on the matrix diagonals below the center (T) diagonal and lagged two periods. In this example, in analysis period 2, reset trees are planted at age 0 (R 20 ). The resets then follow the same evolution over the analysis periods and are reduced at the appropriate tree loss rate for their age. In the model, 100% of dead/unproductive trees are reset at the end of each 2 year period up until year 12 when only 50% of the trees lost are reset. Where: t = analysis period, a = tree age, s = starting tree age T = % of original trees/acre, R = % of reset trees/acre L = tree loss rate con ditional on tree age D = Density of trees/acre B = tree age distribution of grove (4.22) T ta x (1 L a ) x D + R ta x (1 L a ) x D + R ta x (1 L a ) x D + R ta x (1 L a ) x (.5)D

PAGE 66

66 + R ta x (1 L a ) x (.5)D = B t This is due to the opinion that higher density plantings wil l be maturing at around 10 years of age, and the older original trees will shade out the young reset trees if spaced too closely together (Muraro 2006 IV) Calculating Yields for a Mixed Age Grove The per acre yields given by a mixed age grove can be considered an extension of the age distribution equation above. As trees age, box production per tree increases, also, pound solids per box increase with tree age. In equation (2), an additional term for box yield per tree and pound solid per box by tree age is added to each tree age cohort. This captures the differences in yields between trees planted at different times. Appendix B Table B2 illustrates the yield distribution by tree age for Valencia oranges on the Ridge. ( 4.23) T ta x (1 L a ) x D x Y a x S a + R ta x (1 L a ) x D x Y a x S a = Total boxes per acre t = Total pounds solid per acre t Where Y a is boxes per tree for a tree of age a and S a is pound solids per box for a tree of age a. Determining Grove Production Costs This analysis works with the assumption of the use of precision agriculture in grove management, and applies the tree age matrix to adjusting costs by tree age. First, mature grove costs for a 10+ year old grove are determined for the base and disease sce narios based on IFAS

PAGE 67

67 citrus production budgets. Cost categories that vary by tree age are cultivation and herbicide, spraying/chemicals, fertilization, pruning/topping/hedging, and irrigation. The costs are adjusted by tree age according to the schedule in Appendix B, Table B8 Grove Cost Adjustment by Tree Age. Solidset grove costs for years 1 through 4 of tree age are determined separately for the base and disease scenarios. If the grove is being solidset, the model charges planting costs for special cultivation and herbicide applications(years 1 4), tree wrap maintenance (years 1 3), labor for cutting sprouts (years 1 2), Ridomil/Aliete application for foot rot (years 1 2), tree cost, and one time charges for staking, planting, tree wrap, and first wa tering of the tree. Spray/chemical costs are adjusted according to the above schedule ( s ee Appendix B, Table B3 Solidset Costs by Disease Scenario) Reset costs for year 1 through 3 are determined separately for the base and disease scenarios. As state d in Chapter 1, reset trees incur supplemental costs in addition to normal grove care costs for about the first three years of life. Supplemental reset costs include maintenance and cultivation (for years 1 3), and one time planting charges for site prep aration, dead/unproductive tree removal, nursery tree cost, staking, planting, and first watering the tree. These costs are in addition to the normal costs incurred for 1 to 3 year old trees. To incorporate changes in the grove care costs due to tree l oss and resetting, a matrix approach is used to provide a simple and dynamic method for adjusting total costs by the number of trees of each age. A grove care budget is created for the grove adjusted by tree age from planting to 15 years of age ( s ee Appen dix B, Table B5 New Planting/Replanting Operating Cost Budget for Valencia Grove)

PAGE 68

68 This budget is used to form a 15x1 vector for each grove cost category (for example, cultivation of grove costs by tree age) that begins with the starting age of the orig inal trees. The tree age matrix of the original planted trees only (the reset trees are separated out and will be used in the next step) is a diagonal matrix with zeros on the off diagonals that gives the percentage of the original trees by age and by yea r of analysis. The tree age matrix is multiplied by the cost category vector to give a vector of costs adjusted to tree ages for all the periods of analysis. For example, 90% of the original planted trees exist in year ten, and are ten years old (Notatio n: T 10,10 ). 90% is multiplied by the cost for cultivation and herbicide for ten year old trees (C 10 ) which gives the total cost of cultivation and herbicide attributable to the original planted trees in year 10. For simplicity of illustration, Figures 4 .3 and 4.4 separate the original trees from reset trees, however, in the actual calculation these two categories are combined in the same matrix following Figure 4 3. Figure 4 3 Cost calculation by tree age (original trees) Subsequently, a similar operation is used to determine the costs for reset trees, starting with the reset trees age matrix. The diagonal of this matrix consists of zeros (the original trees were se parated and used in the previous step) and the reset trees reside in the lower triangle. Due X = Where: T ta = Percent of Trees of age (a) at time (t) C ta = Total cost per acre for tree age (a) at time (t) W t = Adjusted cost per acre for trees T at time (t) Original Trees T 00 T 11 T 22 .. .. T ta C 00 C 11 C 22 .. .. C ta W 0 W 1 W 2 .. .. W t

PAGE 69

69 to the biennial resetting program assumed in this analysis, the resets are planted at two year intervals (every other year). For example, in year 4 of the analy sis, the total number of resets will consist of those planted in year two which are now two years old, plus new resets planted in year 4 which are 0 years old. Therefore, the reset costs incurred in year 4 (Z 4 ) are the percentage of zero (R 40 ) and two yea r old (R 42 ) resets times the supplemental costs for zero (S 0 ) and two year old (S 2 ) resets plus the grove care costs for zero (C 1 ) and two year old (C 2 ) trees. Figure 4 4 Reset tree age matrix Therefore, the total operating cost per acre at analysis period t (C t ) is a combination of the adjusted cost per acre for the original trees at period t (W t ), and the adjusted cost per acre for the reset trees at period t (Z t ). Some operating costs are fixed, and are not adjusted according to tree ag e. Overhead, maintenance, and miscellaneous are fixed as a percent of mature grove costs, while property taxes follow a fixed rate schedule of increases as the grove matures. These fixed costs are collected into the term (F), and are added to the adjuste d costs for the original and reset trees to form a total cash budget for the 15 year analysis ( s ee Appendix B, Table B6 Mature Valencia Grove Operating Cost Budget). (4.24) C t = W t + Z t + F t Reset Trees Age Matrix 0 R 20 0 0 R 31 0 R 40 0 R 42 0 0 R 51 0 R 53 0 .. .. .. .. .. R 15,9 0 R 15,11 0 R 15,13 0 0 S 0 + C 1 S 1 + C 2 S 2 + C 3 C 3 .. C 15 0 Z 2 Z 3 Z 4 Z 5 .. Z 15 X = Where, R t,a 2 = Percent of reset trees in grove lagged two years S a = Supplemental reset costs for tree age 1 to 3 C a = Total cost per acre by tree age Z t = Adjusted cost per acre for all resets of all ages in year (t).

PAGE 70

70 Determining Cash Flows By adjusting yields and costs to t he age of the trees, this model creates a realistic portrayal of the dynamic nature of the citrus grove. The basic operating cash in flows are constructed as a function of analysis period (t), tree age (a), number of trees per acre (T), box yield per tree (Y), harvest cost per box (H). Since this analysis presents both processed and fresh market varieties, additional terms must be introduced to calculate price by market outlet, these are: pound solid yield per box for oranges (S), the price per pound soli d (P PS ), the packout rate for grapefruit as a percentage of harvested fruit saleable as fresh (K), and the price for fresh grapefruit (P F ) and processed grapefruit (P P ), since they are significantly different. Grapefruit prices do not include harvest cos and hauling charges. The presence of canker is expected to reduce per tree yields ; therefore a percentage term for the yield penalty (Q) related to canker is included in th e cash in flow equation. Oranges: (4.25) CASH IN FLOW (CF+) t = Y ta x (1 Q) x S t a x T ta x P PSt Y ta x (1 Q) x H t Grapefruit: (4.26) CASH IN FLOW (CF+) t = (Y ta x T t a x K t x P Ft ) x (1 Q) + (Y ta x T ta x (1 K t ) x P P ) x (1 Q) t = analysis period a = tree age Cash out flows are considered the same for oranges and grapefruit and are constructed as a function of analysis period (t), tree age (a), the number of trees per acre (T), and the operating c osts per acre (C). The presence of canker or greening in the grove is expected to incur

PAGE 71

71 additional costs in the term (D), which has variable and fixed components. The variable disease costs (DV) are related to the increases in spray programs which are ad justed according to tree age, while fixed disease costs (DF) are incurred through grove inspections and windbreaks for fresh market grapefruit with canker. (4.27) D t = DV ta + DF (4.28) CASH OUT FLOW (CF ) t = C t + D t The cash flow in each period is now constructed for the NPV model where the cash inflow and cash outflows for each period are collected into cash flow one term (CF), which may be positive or negative dependin Adding the additional terms for the grove establishment or purchase costs (generally referred to as the initial investment) and the terminal value completes the multiperiod NPV model. All cash flows are considered to be end of period and are discounted from that point, however the initial investment is the period 0 cash flow and will include grove establishment cos ts plus (if there are existing trees) cash inflows and outflows related to operations in period 0. The terminal value also includes operational cash flows in period 15 plus the terminal grove value. T (4.30) PV = CF 0 + CF t + CF T t =0 (1+r) t (1+r) T T T (4.29) PV = (CF+ t ) + (CF t ) = CF t t=0 (1 + r) t t=0 (1+r) t

PAGE 72

72 CHAPTER 5 EMPIRICAL RESULTS Alternative scenarios are constructed to develop hypothetical situations currently faced by Florida growers. First, investment scenarios are determined based on either new plantings (with and without land costs), or mature plantings without land costs. Then, the production costs and yields detailed in Chapter 2 are established for Hamlin and Valencia sweet oranges grown for the processing (juice) market on both ridge and flatwoods locations, and colored (Red or Pink) grapefruit grown for the fresh fruit market on an Indian River location. Finally, assu mptions are applied for additional costs, yield decline, and tree losses due to the different diseases. In Appendix B, detailed cost budgets illustrate the Solidset Costs (Table B 3) of grove care expenses for the first four years of a new Valencia planti ng. Appendix B tables B 15, B 16, and B 17 show annual mature grove production costs with the canker, greening, and canker and greening diseases scenarios, respectively. Actual production costs are reported in Appendix B (Tables B 5 and B 6) for a Valenc ia ridge grove, and vary from the annual figures because of adjustments for tree age, tree loss, and resetting. The return on investment is determined at different price levels for citrus using a net present value framework over a 15 year period of analy sis. Price is assumed to remain constant over the analysis period. In this respect, price serves as an indicator of the effects of changing costs and disease scenarios. The breakeven prices reported are the lowest prices where the NPV of the grove is po sitive over the 15 year period. All calculations are performed on a per acre basis. Results of the Mixed Age Grove Model Yield and Cost Analysis For a new planting of citrus, initial planting (solidset) costs are included in grove expenses. These costs include initial tree and planting costs, as well as the previously indicated young tree

PAGE 73

73 care, but not irrigation installation and land preparation. Figure 5 1 shows the evolution of yields and expenses for a new or replanted Valencia orange grove on the Ridge over the analysis period, where annual box yields per acre are listed on the left axis and operating costs per acre on the right axis. One can observe in Figure 5 1 that after the initial costs of bringing the trees into production, costs rise as th e grove matures, and then level off. The periodicity due to resetting starts to become more apparent at tree ages ten to fifteen. It is interesting to note the periodicity of operating costs due to a biennial resetting policy. This periodicity disappear s with either an annual or no resetting policy. It does suggest an ability to manage expenses by putting off resetting in times of low prices or production. This periodicity would be greater with certain blight susceptible rootstocks such as Volkameriana or Rough Lemon, where tree loss due to blight increases after maturity. In the analysis of new plantings, yields peak at year 10 and then decline. Further analysis reveals that the high density planting of Valencia settles into an equilibrium of 450 to 500 boxes per acre. The yields peak at year 10 because of the initial yield data the model is given. Trees on more slowly maturing rootstocks, such as Cleopatra Mandarin, would be expected to peak later. The analysis continues with projecting the expecte d yields and costs of a mature Valencia grove on the ridge. Tree density on the ridge is assumed to 112 trees per acre and to start with the tree age distribution in Table 5 1 which was endogenously derived using the analysis model to project the ending t ree age distribution (at year 15) after starting with a solidset grove, assuming biennial resetting, and state historical tree loss rates. As shown in Figure 5 2, production declines slightly from 290 boxes per acre to stabilize around 275 boxes per acre. This reflects the higher loss rates among older (15+ year old) productive trees, but eventually settling to an equilibrium level.

PAGE 74

74 Figure 5 1. Costs and yields for a newly planted Valencia grove on the Ridge Table 5 1 Beginning t ree a ge d istribution fo r m ature Valencia on the Ridge Mature Valencia Ridge Grove (112 trees/acre spacing): Total # of Bearing Trees Non bearing 1 3 yrs 4 10yrs 11 15yrs 15+ yrs Number 3 12 9 4 84 109 Percent 3% 11% 8% 3% 75% Figure 5 2. Costs and yields for a mature Valencia grove on the Ridge

PAGE 75

75 Applying the canker disease scenario to the model results in increases in costs and decreases in yields. Based on the initial assumptions given in Chapter 3, canker acts to simply shift yields down and costs up. As expected, the effect is more pronounced with the level of susceptibility. Valencia oranges show the least effect, followed by Hamlin oranges, while yield year old colored grapefruit grove is to shift the equilibrium yields down from approximately 340 350 boxes per acre, to around 300 boxes per acre. Annual operating costs are shifted up from approximately $1,200 per acre to $1,460 per acre. The adverse effects of citrus greening are shared by all three varieties under study. As shown i n Figure 5 yields and increases costs. In the severe greening scenario, the increased tree loss acts to drop mature grove yields from approximately 400 boxes per acre to the 300 350 boxes per acre range. Annual operating costs increase from approximately $1,015 per acre to $1,275 per acre for additional spraying, inspections, and other disease related costs. The reduction in costs observed in Figure 5 4 is attributable to the reduc tion in harvesting costs due to the reduced yields. Also observable is the higher fluctuation of costs due to increased tree loss and higher resetting expenses.

PAGE 76

76 Figure 5 3. Costs and yields for mature Indian River grapefruit grove with canker Figure 5 4. Costs and yields for mature Hamlin flatwoods grove with greening An interesting result is the necessity of an aggressive resetting policy in the presence of greening. Figure 5 5 illustrates the effect with a mature Valencia grove on the ridge, the g rove shows a precipitous decline under a no resetting policy with only 44 trees per acre of the original 112 trees per acre remaining at the end of the 15 year analysis period. Biennial resetting maintains 102 bearing trees per acre with of the trees in b earing age. On first glance, it appears

PAGE 77

77 that aggressive resetting is necessary to sustain yields with a greening infection the more aggressively a grove is reset, the more trees remain in bearing age. The results of this model may not be validated in an actual grove situation if greening is more severe in young reset trees. There is evidence, as shown in the Chapter 3 survey of scientific literature regarding canker and greening, that resetting individual trees in a grove with a severe greening infection may be unadvisable due to the behavior of the psyllid insect vector which is attracted to the growth flushes of young immature trees. Figure 5 5. Resetting comparison Investment Scenarios New Planting Scenario represents the situation of a grower who intends to plant citrus and must purchase land at current market prices. The land cost is assumed to be improved pasture or cropland already zoned for agricultural use as reported in the IFAS 2005 Rural Land Value Survey for the respective areas of the st ate (Reynolds 2005). This scenario attempts to gauge investment returns for new entrants into the citrus industry or current growers looking to expand

PAGE 78

78 their operations. Also, this scenario may apply to investors wishing to speculate in long term property appreciation while generating income from citrus. Replanting Scenario is representative of a grower or landowner who already owns land and intends to plant citrus. This land may be new to citrus, the grower may be replacing an unproductive grove, or repl anting a grove previously eradicated due to citrus canker. No opportunity costs are assumed for alternative uses for the land, either agricultural or non agricultural. This scenario would especially apply to large citrus operations with contiguous proper ties and vacant land due to canker eradication, or those wishing to plant citrus instead of other agricultural operations (i.e. livestock, forestry, sod, etc.). Also, this scenario may apply to investors speculating in long term appreciation in property values, and opportunities for generating income from the land during the interim. Mature Grove Scenario (without land costs) is based on a grower/landowner who owns a mature (15 year old) grove at the beginning of the planning horizon. This scenario appli es to established growers who did not suffer losses from citrus canker eradication, and seek to examine the long term profitability of their groves. Mature Grove Scenario (with land costs) is based on an investor looking to purchase a mature (15 year old) grove. The purchase price is a set at $10,000 per acre for all varieties and locations. It is a reasonable estimate given prices for mature orange and grapefruit groves as reported in the 2005 Florida Land Value Survey (Reynolds 2005).

PAGE 79

79 Table 5 2 Init ial i nvestment c osts by s cenario Grove Scenario Location Land Cost Irrigation Installation Land Preparation New Plantings* Ridge 6,426 1,350 615 Flatwoods 5,895 1,000 1,422 Indian River 5,895 1,000 1,422 Replantings Ridge 1,000 615 Flatwoods 1,000 1,251 Indian River 1,000 1,251 Mature Grove Ridge (w/o land cost) Flatwoods Indian River Mature Grove Ridge 10,000 (w/ land cost) Flatwoods 10,000 Indian River 10,000 Source: IFAS Citrus Production Budgets 2005 6 New planting uses land cost for improved pasture land from IFAS 2005 Florida Rural Land Value Survey Disease Assumptions Base (No canker or greening) uses the production costs listed in Chapter 1, based on actual costs for the 2004 05 season. Tree loss rates reflect an estimated state historical average, excluding the effects of development and eradication. Tree loss rates for all disease scenarios are presented in Table 5 3. Canker only uses Chapter 3 estimates for increased costs due to endemic citrus canker within the state. Also following Chapter 3, a yield penalty of 10% is applied to Hamlin orange and Red Grapefruit varieties because of their increased susceptibility, and 5% to Val encia oranges. A slight increase in tree loss (10%) is added across the all varieties and ages. Greening only uses Chapter 3 estimates for increased costs due to intensive control of the Asian citrus psyllid insect vector of greening. This incorporates a dditional spray costs based on IFAS Integrated Pest Management guidelines. This analysis uses the medium rate of tree loss due to greening.

PAGE 80

8 0 Canker and Greening (low, medium, high) uses combined estimates for costs due to each disease. This reflects some amount of overlap between management programs. Due to a lack of certainty about exactly what effects Greening will have in Florida, the analysis is calculated for three different levels (low, medium, and high) of tree loss. Table 5 3 Tree l oss p ercentage by s cenario TREE AGE (in years) BASE* GREENING CANKER Low Medium High 1 3 1.00% 2.00% 2.50% 4.00% 1.10% 4 11 1.50% 2.63% 3.00% 4.50% 1.65% 12+ 3.50% 5.25% 6.13% 8.75% 3.85% Estimated average state historical tree loss (excluding effects of development and eradication) Calculation of Breakeven Prices After the operation of grove costs and yields is established in the model, price is applied as an exogenous variable to determine the minimum price at which, for a given cost and yield scenario, a grower or investor can expect a positive return on his or her investment. For the purposes of this analysis breakeven prices are defined as the lowest average price over a 15 year analysis where the NPV of the grove is positive. This is analy zed by computing the NPV for a range of prices. The breakeven price is not a measure of year to year profitability, but of the adjusted discount rate. Prices be low the breakeven level signify that the grove will lose money in real terms over the 15 year period, and prices above signify profits in real terms in excess of the discount rate. Due to the focus on oranges for the processing market and grapefruit for t he fresh market, processed and fresh market prices are used for oranges and grapefruit, respectively. The price used to calculate gross revenue for oranges for processing is the delivered in price per pound solid. Then picking, roadsiding, and hauling co sts are subtracted to arrive at the net

PAGE 81

81 revenue of a box of oranges delivered to a processing plant. The price used to calculate revenue for grapefruit is a combination of the on tree price per box for fresh and processed sales. The e value of a box of fruit already subtracted the costs of picking, roadsiding, and hauling. Grapefruit grown for the fresh market will have a certain number of fruit graded unfit for fresh sale (eliminated) and sent for processing into juice instead. The percentage of the total amount of fruit delivered to the packinghouse and sent to the fresh market is referred to as packout rate is assumed to be 60%. On tree fresh prices in dollars per box are reported below, while eliminations sent for processing receive a price of $2/box in all scenarios. Results of the Mixed Age Grove Model Breakeven Price Analysis Under field conditions, citrus production is not nearly as deterministic as portrayed in this analysis. Citrus trees are biological organisms and thus respond (sometimes unpredictably) to changes in their environment. Climate and individual grove site characteristics have important and widely divergent effect s on production and costs. Also, there is evidence that alternate bearing patterns exist for some varieties, and may significantly affect tree yields in a given season. Production costs and technologies change over time and affect operating budgets. Mor eover, growers practice a range of cultural care programs, and their individual costs may be different. Individual growers, landowners, or investors have different asset/liability positions, tax rates, capital gain/loss carry forwards, and risk preferences that change the dynamics and profitability of a citrus investment. All analysis and calculations are conducted on the basis of unleveraged cash flows before income tax in order to focus on cash flows attributable specifically to citrus operations. Also, by excluding land value appreciation through the terminal

PAGE 82

82 grove valuation method used, we attempt to remove distortions caused by recent surges in Florida rural land values, and arrive at a true value for growing citrus in Florida. The scenarios and assum ptions presented attempt to illustrate important aspects of the decision making process faced by those involved in citrus production across Florida. Citrus is an investment where a large upfront cost is incurred (buying and preparing the land and planting the trees) with operating profits delayed several years until the trees become productive, and sunk costs being recouped after that, all depending on volatile fruit prices. Due to the nature of discounted cash flow analysis, changes in the upfront invest ment costs have a disproportionate 5 4.

PAGE 83

83 Table 5 4 Estimated breakeven prices across disease scenarios, varieties, and production regions (Price* at which NPV of grove cash flows over 15 yr period is positive) RIDGE FLATWOODS INDIAN RIVER Valencia Hamlin Valencia Hamlin GFT New Plantings Base $1.40 $1.30 $1.50 $1.40 $10.00 Canker $1.50 $1.40 $1.60 $1.50 $13.00 Greening low $1.60 $1.50 $1.70 $1.60 $13.00 G&C low $1.70 $1.60 $1.80 $1.70 $15.00 G&C med $1.70 $1.70 $1.80 $1.80 $15.00 G&C high $1.90 $1.80 $2.00 $1.90 $17.00 Replantings Base $1.00 $0.90 $1.00 $1.00 $6.00 Canker $1.00 $1.00 $1.10 $1.10 $8.00 Greening low $1.20 $1.10 $1.20 $1.10 $8.00 G&C low $1.20 $1.20 $1.20 $1.20 $10.00 G&C med $1.20 $1.20 $1.30 $1.30 $10.00 G&C high $1.30 $1.30 $1.40 $1.40 $11.00 Mature Grove Base $0.60 $0.60 $0.50 $0.50 $4.00 (w/o land cost) Canker $0.60 $0.60 $0.60 $0.60 $7.00 Greening low $0.70 $0.70 $0.60 $0.60 $6.00 G&C low $0.70 $0.80 $0.60 $0.70 $8.00 G&C med $0.70 $0.80 $0.70 $0.70 $9.00 G&C high $0.80 $0.80 $0.70 $0.70 $9.00 Mature Grove Base $1.00 $0.90 $0.90 $0.90 $11.00 (with land cost) Canker $1.10 $1.00 $1.00 $1.00 $14.00 Greening low $1.10 $1.10 $1.10 $1.00 $13.00 G&C low $1.20 $1.20 $1.10 $1.10 $15.00 G&C med $1.20 $1.20 $1.10 $1.10 $15.00 G&C high $1.30 $1.30 $1.20 $1.20 $17.00 *Price in $/P.S. for oranges, and $/on tree box (fresh) for GFT The Effect of Agricultural Land Prices on Grove Profitability The land prices used in the new plantings scenario are for improved pasture costing $6,426 per acre for Central Florida ridge plantings, and $5,895 per acre for South West Florida and Indian River flatwoods plantings. For the mature grove with land cost s cenario, a price of $10,000 per acre was applied. These prices are representative of agricultural land costs for areas available for expansion of citrus plantings. These prices were reported as of May 2005, and may have significantly appreciated since th en, which would understate the negative effects of land

PAGE 84

84 costs on new plantings. The current rural land price market in Florida constitutes a relatively large and disproportionate upfront cost for a grower who wishes to purchase land and plant citrus. In r eality, all citrus growers have incurred a land cost at some point, and the assumption of zero land cost in the replanting and mature grove scenarios without land cost is not realistic. Some portion of this land cost should be charged against the returns of a citrus investment. As in any commercial real estate investment, many growers/landowners/investors look not only at the income generated by the property, but also appreciation of the underlying land. Since this analysis values only the returns associ ated with a citrus investment, and not land price appreciation, these scenarios can be thought of as establishing upper and lower bounds on the profitability of grove investment decisions facing the Florida citrus industry. At the upper extreme, some grow ers/landowners/investors may evaluate a citrus grove as an investment in isolation, and only care about the returns to the citrus operation. Therefore, they may apply the entire land cost against the profitability of the grove. This is illustrated by the new plantings scenario, and could represent those growers considering citrus as their primary business. At the lower extreme, some growers/landowners/investors are purely interested in returns from land price appreciation, and view citrus as an interim i ncome producing activity until they opt to realize their gains on the land. These owners would not apply any of the land cost against the profitability of the grove, instead viewing land cost as recouped upon eventual sale of the grove. This is illustrat ed by the replanting (without land cost) scenario, and could represent investors acquiring land for future non agricultural development. The replanting scenario (without land cost) also includes growers who may have had sections of groves

PAGE 85

85 eradicated due t o canker, but do not have the ability to sell the area due to effects on their entire grove. The reality is that most people involved in growing citrus are somewhere in the middle; neither charging the entire land cost against the citrus investment, nor ex pecting the entire return on investment to come from land price appreciation. In weighing the results of this analysis, one should view the breakeven prices for new planting and mature groves with land costs against replanting and mature groves without la nd costs as a range between which one can expect investment or planting of citrus. According to this analysis for a Valencia orange grove on the ridge, even with the presence of endemic canker and a high rate of tree loss due to greening, a citrus investm ent is profitable in the range of $1.30/P.S. (for replanting without land cost) to $1.90/P.S. (for new planting with land cost). This range incorporates our conservative estimate for the residual value of the grove as explained in Chapter 4. The Effect of Canker on Grove Profitability The change in costs from the base scenario is the greatest (+26% and +22%) for new/replanting and a mature grove of grapefruit, respectively, because of significantly increased spray and canker free certification costs for fr esh market citrus. The increase in costs for new/replanting of Hamlin oranges (+11 13%) compared to Valencia oranges (+8 9%) reflects Yield penalties of 10% for Hamlin oranges and grapefruit, and 5% for Valencia oranges loss rates were increased 10% over the historical average across varieties to account for the removal of infected tree s. Changes in average yields due to canker are slightly higher due to the compounded effect of the yield penalty and higher tree loss.

PAGE 86

86 In this analysis, canker does not dramatically increase the breakeven prices for oranges for processing. Although break even prices for new plantings are $1.50 to $1.60 per pound solid, once land costs are excluded, breakeven prices attributable exclusively to canker increase slightly to $1.10 per pound solid for both Hamlin and Valencia oranges. Mature plantings without land costs continue to show profitability down to $0.60 to $0.70 per pound solid for oranges. The effects of canker on oranges for processing, even the more susceptible Hamlin oranges, appears to be negligible. Replanting of grapefruit for fresh market re quire a breakeven price of $9.00 per box in the presence of canker, which is historically high compared recent past non hurricane seasons, but appears reasonably sustainable given recent developments in grapefruit supply statewide. Mature plantings witho ut land cost continue to create significant cash flows even below $0.60 $0.70 per pound solid for sweet oranges and $7.00 per box for grapefruit. A worst case scenario for grapefruit was performed where the packout rate was set at 40%, and this resulted i n a significant effect on profitability, with breakeven prices for worst case scenario grapefruit increasing to $19.00 $11.00 per box for new and replanting, respectively, $19.00 and $9.00 per box for a mature grove with and without land costs, respectivel y. The worst case scenario shows the dramatic sensitivity of returns to grapefruit from changes in the packout rate. An alternative assumption was considered with the possibility of spot picking (selective harvesting) fresh grapefruit to raise the packou t rate back to 60%. An additional $.40 per box spot picking charge was incorporated for boxes of fresh market fruit. This additional charge brought the breakeven price very close to the original canker scenario (with 60% packout rate), illustrating that spot picking may be necessary to maintain grapefruit profitability in the presence of canker.

PAGE 87

87 Finally, a scenario was tested where all the costs for controlling canker are incurred, but no yield penalty or packout loss is assumed. This is based on the id ea that successful canker management may result in no decrease in yields or packout, and applying increased costs and decreased yields at the same time may overstate the effects of canker on an intensively managed grove. Breakeven prices increase moderate ly, and show the benefit of an effective canker management progr am in fresh market grapefruit. Table 5 5 Grapefruit p ackout p rice v omparison Scenario Packout Rate Breakeven New Plantings Base 60% $ 10.00 with Canker 60% $ 13.00 with Canker (worst case) 40% $ 19.00 with Canker (spot pick*) 60% $ 14.00 with Canker (no yield/packout loss) 60% $ 12.00 Replantings Base 60% $ 6.00 with Canker 60% $ 8.00 with Canker (worst case) 40% $ 11.00 with Canker (spot pick) 60% $ 9.00 with Canker (no yield/packout loss) 60% $ 7.00 Mature Grove (without land cost) Base 60% $ 4.00 with Canker 60% $ 7.00 with Canker (worst case) 40% $ 9.00 with Canker (spot pick) 60% $ 7.00 with Canker (no yield/packout loss) 60% $ 6.00 Mature grove (with land cost) Base 60% $ 11.00 with Canker 60% $ 14.00 with Canker (worst case) 40% $ 19.00 with Canker (spot pick) 60% $ 14.00 with Canker (no yield/packout loss) 60% $ 12.00 Spot picking assesses a $.40/box surcharge per box sold fresh Further sensitivity analysis for Hamlin oranges shows that if yield loss can be controlled, assum es a yield loss of 15%, and illustrates a significant, but not immense, increase in the

PAGE 88

88 breakeven price. This suggests that profitability for a Hamlin grove selling to the processing market may not be catastrophically affected by canker. Table 5 6 Hamli n y ield l oss s ensitivity Scenario Yield Loss Breakeven New Plantings Base 0% $1.40 with Canker 10% $1.50 with Canker (no yield loss) 0% $1.40 with Canker (no management) 15% $1.60 Replantings Base 0% $1.00 with Canker 10% $1.10 with Canker (no yield loss) 0% $1.00 with Canker (no management) 15% $1.20 Mature Grove ( without land cost) Base 0% $0.50 with Canker 10% $0.60 with Canker (no yield loss) 0% $0.60 with Canker (no management) 15% $0.70 Mature grove (with land cost) Base 0% $0.90 with Canker 10% $1.00 with Canker (no yield loss) 0% $0.90 with Canker (no management) 15% $1.10 While increasing production costs and decreasing yields, especially for fresh market grapefruit, canker in isolation appears to have a relatively small effect on the profitability of significant and bordering on catastrophic if canker reduces packout rates. It can be supposed that if adequate control measures are taken, and canker is not allowed to firmly establish itself in a grove, profitability will remain mostly unchanged. Effects of Greening on Grove Profitability In the greening only analysis, we assume greening increases tree loss to 2% per year for trees from 0 to 3 years of age, 2.63% for trees aged 4 11, and 5.25% for trees 12+ years. This is compared to the historic state wide tree loss rate of 1%, 1.5%, and 3.5%, respectively. Psyllid

PAGE 89

89 control, increased resetting, and field inspec tions for greening result in an increase in production costs across all varieties and grove ages. Production costs for oranges increase (+32% 35%) for new plantings/replanting and (+25% 27%) for mature plantings. Production costs for grapefruit increase (+27%) for new planting/replanting and (+21%) for mature plantings. The difference between new planting/replanting and mature plantings reflect the disproportionate effect of greening on young tree loss, and the need to incur additional reset costs. How ever, mature groves suffer larger reductions in average per acre yields due to the absolute increase in the loss of older, highly productive trees. The presence of greening appears to have a greater effect on breakeven prices compared to canker. Breakeven prices for new plantings move into the $1.50 $1.70 per pound solid range for oranges, and $13.00 per box for grapefruit. Breakeven prices for replanting are $1.10 $1.20 per pound solid for oranges, and $8.00 per box for grapefruit. Breakeven prices for mature groves without land costs are less than $.60 $.70 per pound solid for sweet oranges and $6.00 per box for grapefruit. This indicates that while greening by itself does boost production costs significantly, its effect on replanting and mature groves (without land costs) given current price levels shows that citrus remains a profitable investment. A sensitivity analysis on tree loss rates exhibit that higher tree loss rates has a small effect on breakeven prices. Another effect of greening is that av erage annual tree maintenance costs actually decline as tree loss rates increase. This result relates to the use of precision agriculture in which greening kills older trees and reduces the amount of materials and labor required for their maintenance, plu s harvest costs decline due to reduced yields. This trend may be an artifact of the analysis assumptions and may not reflect actual grove circumstances. Moreover,

PAGE 90

90 significant declines in fruit production due to the loss of mature, highly producing trees more than offset any cost savings. Table 5 7 Tree l oss c omparison for a Valencia g rove on the Ridge with g reening Scenario Avg. Expenses* Yield Breakeven New Plantings Greening Low $1,080.45 488 $1.60 Greening Medium $1,090.11 474 $1.60 Greening High $1,124.38 426 $1.70 Replantings Greening Low $1,080.45 488 $1.20 Greening Medium $1,090.11 474 $1.20 Greening High $1,124.38 426 $1.30 Mature Grove without land cost Greening Low $1,101.57 268 $0.70 Greening Medium $1,090.83 258 $0.70 Greening High $1,062.74 231 $0.80 Mature grove with land cost Greening Low $1,101.57 268 $1.10 Greening Medium $1,090.83 258 $1.20 Greening High $1,062.74 231 $1.30 Avg. Expenses are annual per acre, with yrs 3 15 for new/replantings and yrs 1 15 for mature plantings Canker and Greening Scenarios The current reality of citrus growing in Florida appears to be that growers are challenged 4) were conducted for all three greening tree loss rates plus yield losses due to canker. Costs were adjusted to reflect a hypothetical combined management program. In combination, canker and greening significantly boost production costs, decrease yields, in crease breakeven prices, and, therefore, reduce profitability. With even the low rate of tree loss due to greening, breakeven prices in the new plantings scenario move to $1.60 $1.70 per pound solid for oranges, and $15.00 per box for grapefruit. Breakev en prices for the replanting scenario increase to $1.20 per pound solid for oranges and $10.00 per box for grapefruit. A mature grove without land cost increases to $0.60 and $0.80 per pound solid for oranges and $8.00 per box for grapefruit. Finally, th e breakeven price for a mature grove with land cost increases to $1.10 $1.20 per pound solid for oranges and $15.00 per box for grapefruit. These

PAGE 91

91 prices are high by historical standards, and the possibility of achieving sustained prices above $1.50 per po und solid for oranges or $10.00 per box for grapefruit is questionable. Therefore, canker and greening act to decrease the profitability, especially of new plantings and mature groves where land must be purchased at market prices.

PAGE 92

92 CHAPTER 6 SUMMARY AND C ONCLUSIONS Given the short period that the Florida citrus industry has dealt with greening and canker, it is too soon to conclude that the fundamental economics of growing citrus in Florida have changed. The challenge associated with analyzing the impact of canker, greening, and increasing rural land prices is principally the novelty of these issues to Florida growers, and a lack of historical data regarding their effects. Any economic analysis on disease effects on grove production must make assumptions by quantifying non linear and highly complex biological phenomena into monetary or production units in order to be measured. Any economic analysis expectati ons of the value of future income from the land plus appreciation, where assumptions must be made through the discount rate and exit capitalization rate. This analysis uses a NPV framework to evaluate the profitability of a citrus investment, makes assump tions grounded in actual historical data for production costs and yields, and then makes reasonable assumptions about the monetary effects of these new challenges to Florida growers. The value of this examination is to draw conclusions about the attractiv eness of investing in citrus for the the conclusions drawn about the economics of a citrus investment, we may be able to predict the future entry and exit of inves tors in the Florida citrus industry given the behavior of production costs and fruit prices. The limitation of this examination is the unique situation of each grower and grove, which alters any conclusions made which are based on the grove production cos t and yield. In addition, the complex and untested nature of the assumptions used to quantify these new challenges introduces uncertainty into the analysis and ultimate future of the Florida citrus industry.

PAGE 93

93 The assumptions about the consequences of a g rowing environment with endemic canker and greening on grove production were made by looking at production data from other countries and controlled scientific studies, however, the reality of what the true manifestations of these diseases will be in the di infinitely complex biological environment will take time to study and predict. Overall, the development of new production technologies, and the experimentation and adaptation by Florida growers to the manifestations of these diseases will be the true indicator of the long term success of the Florida citrus industry. In the first outbreak of canker in Florida in 1910, anecdotal accounts relate many trees became rapidly infected and unpro ductive, which led to the statewide eradication of a significant portion of Florida citrus trees. At that time groves, however, were not irrigated, fertilizer and pesticide technology was in its infancy, and biological research into the means of infection was rudimentary compared to today. The assumptions made about yield loss and production cost ficantly lower overall level of production technology. Long term studies are needed to measure the spread and virility of infection within different Florida grove locations and by variety, the rate of decline and potential rehabilitation of infected trees and best practices for disease control including sprays, tree care, and grove sanitary controls. These will be the determinants of the ultimate economic consequences of growing citrus in an endemic canker environment. Greening has devastated citrus ind ustries in Asia and Africa, but these citrus industries were nowhere near the sophistication of Florida growers in terms of production technology, and had little access to the resources and scientific knowledge available to the Florida citrus industry.

PAGE 94

94 Sp rays and systemic insecticides aid in the control of the citrus psyllid insect vector, and there is a mounting body of evidence that drought and disease stressed trees are more susceptible to infection. Most likely, this will increase the production cost of growing citrus, however, the Florida citrus industry is already moving towards irrigation and regular spray programs for most commercial groves, therefore the marginal increase in production cost of controlling for greening may be lower than the approxi mately 30% assumed in this analysis. Sciences (IFAS), the USDA Agricultural Research Center at Ft. Pierce (USDA ARS), the Florida Department of Agriculture and Cons umer Services (FDACS), and private industry are investing significant effort into controlling and managing greening. The Florida citrus industry should soon expect results from these research endeavors, including: the establishment of best practices for greening control and management and new methods of biological/chemical control of the psyllid vector. Since greening is fatal to citrus trees, if the spread of greening between and inside groves cannot be controlled, this will have particularly negative e ffects on the citrus investment because of the time frame necessary for the development and profitability of the grove. If the average life expectancy for citrus trees is shortened to eight years (as was the case in Thailand) the economics of growing citr us in Florida is impractical. Therefore, this author recommends that future research efforts to determine the economic effect of greening must focus on the probability of the spread of greening between groves and control of greening within a grove. This will be the ultimate test of the assumptions used in this analysis. The effect of land prices on grove profitability is more easily quantified because there exists a market of agricultural land prices and historical information about the behavior of land prices over time. Unfortunately, deriving an assumption for the average value of land and

PAGE 95

95 making comparisons between citrus properties is difficult for two reasons. First, every piece of land is unique in that it has a specific physical location which c arries specific attributes such as soil, drainage, micro climate, and distance to packinghouses or processing plants which have a direct impact upon the productivity and profitability of the grove. Second, land prices are about the future economic value derived from use or ownership of the land. Expectations about the highest and best use of many Florida citrus groves is changing as the state becomes more urbanized, and a large demand of non agricultural users for citrus g rowing land (particularly in the central ridge and east coast production areas) is divorcing the value of citrus land from the value of citrus production. This analysis attempts to quantify the value of citrus land within the net present value framework wh ere it is assumed that the value of the land equals the present value of the discounted cash flows plus a future sale value (terminal grove value) at the end of the projection period. In this analysis, the terminal grove value is derived from the built up exit capitalization rate method which makes it a function of citrus prices, grove production, market interest rates, the historical volatility of citrus prices, a premium for the ownership risk and additional effort required to manage an agricultural oper ation, a liquidity premium, and a cost of money management assumed for the additional financial structure required for the operation of a citrus investment compared to other investment options (i.e. stocks, bonds, and other financial instruments). In this formula, the one determinant more or less common to all growers is the market interest rate. All other premiums are subjective and specific to the preferences of each grower/investor, and therefore lead to different expectations of grove value. The bui lt up exit cap method is still based on the NPV framework and therefore the income derived from citrus growing, however, non agricultural demand for citrus land adds an

PAGE 96

96 additional appreciation to the transaction price of citrus land as the potential income from non agricultural uses is higher than citrus, and has the effect of lowering the exit cap rate for citrus potential for conversion to non agricultural use. In this analysis, the prices derived for the citrus exit cap rate were similar to actual market transactions from the 1999 2004 period which were taken as a sample which excluded the effects of the strong non agricultural demand for citrus properties. Overa ll, this analysis attempts to exclude appreciation due to non agricultural demand, but this appreciation exists, and may be a significant component of grower/investors subjective valuation of a citrus grove. At the time of writing, macroeconomic factors h ave slowed the non agricultural demand for citrus land, however, continued tracking of Florida agricultural land prices, such as done through the IFAS Florida Rural Land Value Survey, is necessary to determine whether citrus land prices will revert to bein g more closely correlated with the income value of land, or a new price level is established for Florida rural land and will persist. In this analysis, citrus prices are treated as an exogenous variable ; however, they are the ultimate determinate of the p rofitability of the citrus investment. Analysis of citrus price trends is outside the scope of this analysis, but price is the most important component of this analysis as the effects of citrus canker, greening, and rural land prices are all compared on t he basis of the relative change in the breakeven price for the citrus investment within the NPV framework. All results are relative to citrus prices, and the current high price environment makes the citrus investment profitable even with significant incre ases in production cos t, tree loss, and land prices.

PAGE 97

97 The economic model of perfect competition suggests that excess profits or losses are transitory and with no barriers to entry or exit the marginal price of selling a good equals the marginal cost of prod ucing it, and the dynamics of production and competition in the Florida citrus industry exhibit many similarities to this model. Within this model, the NPV of the citrus investment can be considered a proxy for excess profit or losses, while the breakeven price where the NPV equals zero can be considered an equilibrium point. If current prices are expected to be above this breakeven price, then one can expect citrus acreage to expand until the additional supply forces prices down to their equilibrium leve l, and vice versa in the case of price expectations below the current breakeven price. In the real world, many factors conspire to complicate and cloud this fundamental relationship, such as: imperfect information, different subjective price expectations different risk expectations (as transmitted through the discount rate), different cost structures, lags in supply response, changes in demand, foreign competit ion, and personal preferences. In attempting to construct an average return to the citrus inves tment, we can begin to draw conclusions about the current and future prospects for the Florida citrus industry. This analysis finds that current price levels (as of Fall 2007) around $1.75 per pound solid, if sustained, make many of the scenarios examined profitable, even in the presence of canker, greening, and high land prices. The major question remaining is if the current high price environment is sustainable and citrus has established a new higher equilibrium price. In the long run, canker, greening and higher citrus land prices should act to force up the cost of production, and therefore the equilibrium price, however, more research is needed to determine whether other factors, principally US consumer demand for citrus products and Brazilian citrus production costs will allow the price to remain higher.

PAGE 98

98 The three new challenges of canker, greening, and higher citrus land prices will bring change to the Florida citrus industry, and change brings uncertainty. The myriad of other factors interrelated with this uncertainty and their respective feedback loops introduce yet more complexity into the system, and this creates a perception of greater risk in growing citrus in Florida. The Florida citrus industry has experienced and survived other adverse sit uations such crisis, there were people who doubted that the industry will ever recover, however, each time it did because Florida growers change and adapt to the new realities forced upon them. The resilience of the industry comes from the fact that there are few places in the world where the beneficial attributes of abundant land, climate, skilled citrus growers and researchers, financial resources, and a sta ble and consistent political and legal environment have converged to such a great extent as Florida. Once the full effects of these new challenges are felt, growing citrus in Florida will be different, but its prospects look quite good.

PAGE 99

99 APPENDIX A GEOGRA PHIC AND TOPOGRAPHIC FEATURES OF FLORIDA COMMERCIAL CITRUS PRODUCTION REGIONS Florida commercial citrus production is generally divided into four major geographical production regions with citrus grown on two topographic features (Muraro 2004). The Centra l Florida citrus region includes Lake, Polk, and Highlands counties and accounts for about 25% of Hardee, Hendry, and Lee counties with 35% of total citrus a creage. The Western region includes Hillsborough, Manatee, Pasco, and Sarasota counties with 7% of total citrus acreage. The Indian River region refers to the citrus producing counties on Florida's east coast including Brevard, Indian River, Martin, Palm Beach, and St. Lucie counties with 24% of total citrus acreage (FASS 2005). The remaining citrus acreage is dispersed throughout the state with a general orientation acreage. Table A 1 Florida c ommercial c itrus a creage 2004 5 County Acres County Acres Hendry 29,607 Glades 3,517 Polk 24,777 Okeechobee 3,480 Highlands 21,338 Lee 2,861 DeSoto 13,578 Pasco 2,732 Collier 10,478 Orange 1,450 Hardee 10,265 Palm Beach 752 Martin 8,348 Brevard 648 St. Lucie 6,310 Sarasota 285 Charlotte 6,119 Seminole 273 Lake 4,862 Marion 267 Manatee 4,723 Hernando 224 Indian River 4,179 Volusia 169 Hillsborough 3,939 Other 1/ 92 Osceola 3,777 Total 2/ 169,050 1/ Alachua, Citrus, Pinellas, and Putnam counties Source: 2004 0 5 FASS Citrus Summary

PAGE 100

100 Figure A 1 Florida commercial citrus acreage map, 2005 well drained sandy soils (entisols) concentrated in the Central Florida region although the ridge also extends into the Western zone. These soils due to the a refers to low lying, poorly drained soils (alfasols and spodosols) where citrus must be planted on raised furrows to allow for sufficient rooting depth. The Western, South west, and Indian River areas are predominantly of the flatwoods type, but flatwoods groves exist in low lying regions of Central Florida as well. Flatwoods groves tend to grow smaller trees due to the shallower root zone, however, the Indian River region is known for its high quality grapefruit groves which thrive in the poorly drained alfisols of the eastern coast of Florida (Obreza and Collins 2002). Source: FASS: 2004 5 Citrus Summary

PAGE 101

101 Source: Obreza and Collins 2002 Figure A 2 Florida citrus soil types Figure A 3 Illustration of flatwoods grove design

PAGE 102

102 inches of depth that does not allow for drainage of the water table, especially during periods of high rain during the summer. Citrus trees will d ie if their roots are submerged in water for extended periods of time. The poorly drained flatwoods land requires the construction of beds (artificially raised rows of soil) where citrus trees may be planted so as to allow for sufficient rooting depth. C ommonly, these are double row beds that transport water away from the root zone through a network of furrows, drainage pipes, ditches, pumps, and retention ponds. Flatwoods groves incur higher land preparation costs compared to Ridge groves, as show n in Ta ble A 2. Changes to grove architecture and/or tree density require incurring costs for soil preparation and bed construction all over again. Therefore, this analysis assumes that new planting and replanting of citrus will incur the same land preparation costs. Due to the excess space required by drainage management in the flatwoods, there are correspondingly fewer trees per acre of land area in the flatwoods than on the ridge, as reported in Table A 3. This analysis assumes, however, that new flatwoods and ridge groves will have the same high density tree spacing. In order to make production costs and yields comparable, this analysis reports its results per planted acre of citrus. This becomes important when land prices are factored in because prices are per acre. Land price is adjusted by dividing it by the percentage utilization in citrus, assumed to be 95% for ridge groves and 75% for the flatwoods. This converts the land price into per acre of planted citrus terms.

PAGE 103

103 Table A 2. Average c itrus l an d p reparation c osts 2002 0 3 season FLATWOODS RIDGE Land Clearing (pasture) 195 350 Laser Leveling 275 n/a Bedding: 2 row 130 n/a Soil Amendment: Dolomite (1 ton) 35 35 Soil Amendment: Super K (400lbs) 30 30 Canals, Ditches, Dykes 195 n/a Reservoirs and Roads 155 n/a Throw out pumps 55 n/a Culverts 85 n/a Middle Drop Drainage 105 n/a Drainage Tiles 150 n/a Soil Fumigation n/a 330 Cover Crop 12 12 Total: $ 1,422 $ 757 Source: Muraro 2004 Table A 3 Land u tilization of Florida c itrus g roves Ridge Flatwoods Range Average Range Average Planted in Citrus 90 97% 95% 55 85% 71% Roads and Service Areas 3 10% 5% 3 15% 6% Canals and Ditches 0 0 5 10% 8% Water Retention 0 0 10 30% 15% Source: Muraro 2004

PAGE 104

104 APPENDIX B PARAMETERS USED IN T HE ANALYSIS In this appendix, input data used in the grove investment analysis is presented. This includes establishment cost for new plantings, reset costs, grove maintenance costs for both a newly established and mature grove. This data is presented in Tables B 1 through B 4

PAGE 105

105 Table B 1 Solidset costs by disease scenario for a Valencia orange grove in the ridge General Grove Information: Valencia Ridge Grove w/ No Canker or Greening Valencia Ridge Grove w/ Canker Valencia Ridge Grove w/ Greening Solidset Planted Trees (cost / acre) Year 1 Year 2 Year 3 Year 4 Year 1 Year 2 Year 3 Year 4 Year 1 Year 2 Year 3 Year 4 Irrigation 83.09 91.39 99.70 108.01 83.09 91.39 99.70 108.01 83.09 91.39 99.70 108.01 Fertilizer 102.39 112.62 122.86 133.10 102.39 112.62 122.86 133.10 102.39 112.62 122.86 133.10 Fertilizer Through Irrigation 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Spraying 66.12 72.73 79.34 85.96 76.60 84.26 91.92 99.58 167.78 184.55 201.33 218.11 Tree Wrap 50.00 0.00 0.00 0.00 50.00 0.00 0.00 0.00 50.00 0.00 0.00 0.00 Tree Wrap (annual maintenance) 37.50 37.50 37.50 0.00 37.50 37.50 37.50 0.00 37.50 37.50 37.50 0.00 Sprouting (labor) 30.00 30.00 0.00 0.00 30.00 30.00 0.00 0.00 30.00 30.00 0.00 0.00 Cultivation/Mowing 79.60 79.50 95.40 95.40 79.60 79.50 95.40 95.40 79.60 79.50 95.40 95.40 Herbicide 67.50 67.50 75.00 82.50 67.50 67.50 75.00 82.50 67.50 67.50 75.00 82.50 Ridomil/Aliette 52.50 52.50 0.00 0.00 52.50 52.50 0.00 0.00 52.50 52.50 0.00 0.00 Tree Cost (bare root) 1,485.00 0.00 0.00 0.00 1,485.00 0.00 0.00 0.00 1,485.00 0.00 0.00 0.00 Stake, Plant, and Water Tree 261.36 0.00 0.00 0.00 261.36 0.00 0.00 0.00 261.36 0.00 0.00 0.00 Cold Protection 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Disease Related Costs (due to Canker and Greening) 0.00 0.00 0.00 0.00 45.24 45.24 45.24 45.24 62.76 62.76 62.76 62.76 Miscellaneous 10.37 10.87 10.20 10.10 11.49 12.01 11.35 11.28 13.66 14.37 13.89 14.00 Supervision and Overhead 26.45 27.73 26.00 25.75 29.29 30.63 28.95 28.76 34.84 36.63 35.42 35.69 Total: 2,351.88 582.36 546.00 540.82 2,411.55 643.15 607.92 603.86 2,527.96 769.33 743.87 749.57

PAGE 106

106 Table B 2 Reset costs by disease scenario for a Valencia located in the ridge Without Citrus Canker or Greening With Citrus Canker With Citrus Greening With Citrus Canker & Greening Year 1 Year 2 Year 3 Year 1 Year 2 Year 3 Year 1 Year 2 Year 3 Year 1 Year 2 Year 3 Supplemental Maintenance Costs 3.59 2.96 2.34 4.85 4.71 4.63 4.83 4.69 4.6 5.67 6.24 7.07 Site Preparation 4.18 0 0 4.18 0 0 4.18 0 0 4.18 0 0 Tree Cost (bare root) 7.5 0 0 7.5 0 0 7.5 0 0 7.5 0 0 Stake, Plant, and Water Tree 2.55 0 0 2.55 0 0 2.55 0 0 2.55 0 0 Tree Removal Cost 4.45 0 0 4.45 0 0 4.45 0 0 4.45 0 0 Other Costs 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL: 22.27 2.96 2.34 23.53 4.71 4.63 23.51 4.69 4.6 24.35 6.24 7.07

PAGE 107

107 Table B 3 New planting/replanting operating costs for a Valencia grove (without canker or greening) Grove Care Costs 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Cultivation and Herbicide 0.00 177.10 177.00 170.40 177.90 132.42 141.88 151.34 160.79 170.25 189.17 189.17 189.17 189.17 189.17 189.17 Spraying 0.00 118.62 125.23 79.34 85.96 92.57 99.18 105.79 112.40 119.02 132.24 132.24 132.24 132.24 132.24 132.24 Fertilization 0.00 102.39 112.62 122.86 133.10 143.34 153.58 163.82 174.05 184.29 204.77 204.77 204.77 204.77 204.77 204.77 Pruning/Hedging 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 204.77 204.77 204.77 204.77 204.77 204.77 204.77 204.77 Irrigation 0.00 83.09 91.39 99.70 108.01 116.32 124.63 132.94 141.24 149.55 166.17 166.17 166.17 166.17 166.17 166.17 Heating/Cold Protection Costs 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Disease Related Costs 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Other Costs 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Miscellaneous 0.00 10.37 10.87 10.20 10.10 9.69 10.39 11.08 15.87 16.56 17.94 17.94 17.94 17.94 17.94 17.94 Supervision and Overhead 0.00 26.45 27.73 26.00 25.75 24.72 26.48 28.25 40.46 42.22 45.75 45.75 45.75 45.75 45.75 45.75 Total Grove Care Costs: 0.00 518.02 544.86 508.50 540.82 519.05 556.13 593.21 849.59 886.66 960.82 960.82 960.82 960.82 960.82 960.82 Planting Costs: Solidset 0.00 1,833.86 37.50 37.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Reset/Rehab. Tree Removal 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Total Planting Costs: 0.00 1,833.86 37.50 37.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Property Taxes 30.00 30.75 31.52 32.31 33.11 33.94 34.79 35.66 36.55 37.47 38.40 39.36 40.35 41.36 42.39 43.45 Interest on Operating Expenses 0.90 71.48 18.42 17.35 17.22 16.59 17.73 18.87 26.58 27.72 29.98 30.01 30.03 30.07 30.10 30.13 Total Operating Costs (Acre): 30.90 2,454.11 632.29 595.66 591.15 569.59 608.65 647.73 912.73 951.85 1,029.19 1,030.18 1,031.20 1,032.24 1,033.30 1,034.39

PAGE 108

108 Table B 4 Operating costs for a m ature (15+ year old) Valencia grove located o n the ridge (without canker or greening) Grove Care Costs: 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Cultivation and Herbicide 189.17 182.55 176.16 169.99 164.04 158.30 152.76 147.42 142.26 137.28 132.47 127.84 123.36 119.04 114.88 110.86 Spraying 132.24 127.61 123.15 118.84 114.68 110.66 106.79 103.05 99.44 95.96 92.61 89.36 86.24 83.22 80.31 77.49 Fertilization 204.77 197.60 190.69 184.01 177.57 171.36 165.36 159.57 153.99 148.60 143.40 138.38 133.53 128.86 124.35 120.00 Hedging 204.77 197.60 190.69 184.01 177.57 171.36 165.36 159.57 153.99 148.60 143.40 138.38 133.53 128.86 124.35 120.00 Irrigation 166.17 160.35 154.74 149.33 144.10 139.06 134.19 129.49 124.96 120.59 116.37 112.29 108.36 104.57 100.91 97.38 Heating Costs/Cold Protection 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Disease related Costs 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Other Costs 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Miscellaneous 17.94 17.31 16.71 16.12 15.56 15.01 14.49 13.98 13.49 13.02 12.56 12.12 11.70 11.29 10.90 10.51 Supervision and Overhead 45.75 44.15 42.61 41.12 39.68 38.29 36.95 35.65 34.41 33.20 32.04 30.92 29.84 28.79 27.78 26.81 Grove Care Costs (original trees): 960.82 927.19 894.74 863.42 833.20 804.04 775.90 748.74 722.53 697.25 672.84 649.29 626.57 604.64 583.48 563.05 Planting Costs: Solidset 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Reset Tree Costs 0.00 0.00 229.74 30.23 242.17 62.69 267.22 93.41 292.37 126.64 333.86 175.43 285.08 211.54 368.05 248.59 Planting Costs (Reset trees): 0.00 0.00 229.74 30.23 242.17 62.69 267.22 93.41 292.37 126.64 333.86 175.43 285.08 211.54 368.05 248.59 Property Taxes 30.00 30.75 31.52 32.31 33.11 33.94 34.79 35.66 36.55 37.47 38.40 39.36 40.35 41.36 42.39 43.45 Interest on Operating Expenses 0.90 28.74 34.68 27.78 33.25 27.02 32.34 26.33 31.54 25.84 31.35 25.92 28.56 25.73 29.82 25.65 Total Operating Costs (Acre): 991.72 986.68 1,190.68 953.74 1,141.74 927.69 1,110.25 904.14 1,083.00 887.20 1,076.46 890.01 980.56 883.26 1,023.73 880.75 trees

PAGE 109

109 Table B 5 H arvest and other per box costs Picking & Roadsiding $1.64 Transportation to processing plant 0.47 DOC box assessment 0.185 Additional Cost for Fresh Market/Spot Picking: 1.50 Total Processed Market Cost $2.30 Total Fresh Market Cost $3.80 Table B 6 Adjustment factors for grove care cost by tree age COST ADJUSTMENT PERCENTAGE Grove Care Cost Category Cost Adjustment (Yes/No) Age of Trees in Analysis as % of Mature Grove Costs Cultivation and Herbicide Yes 1 50% Spray/Chemical Costs Yes 2 55% Fertilization Yes 3 60% Pruning/Hedging Yes 4 65% Irrigation and Ditch Maintenance Yes 5 70% Heating Cost for Cold Protection: Yes 6 75% Disease Related Costs due to Canker/Greening Yes 7 80% Other Costs Yes 8 85% Supervision and Overhead No 9 90% Miscellaneous No 10 100% 11 100% 12 100% 13 100% 14 100% 15+ 100%

PAGE 110

110 Table B 7 Annual irrigation expense (ridge/flatwoods comparison) ($/Acre) Variable Operating Expense (Diesel) 59.44 Annual Maintenance 50.17 Fixed Depreciation Expense (non cash) 56.56 "Ridge" Total: 166.17 (Additional for Flatwoods) Clean Ditches (Weed Control) 14.19 Ditch and Canal Maintenance 15.06 Water Control (Pump water in/out of Ditches and Canals) 13.21 208.63 Source: 2004 5 IFAS Citrus Production Budgets Table B 8 Average per acre citrus land preparation costs (ridge/flatwoods comparison) FLATWOODS RIDGE Land Clearing (pasture) 195 350 Laser Leveling 275 n/a Bedding: 2 row 130 n/a Soil Amendment: Dolomite (1 ton) 35 35 Soil Amendment: Super K (400lbs) 30 30 Canals, Ditches, Dykes 195 n/a Reservoirs and Roads 155 n/a Throw out pumps 55 n/a Culverts 85 n/a Middle Drop Drainage 105 n/a Drainage Tiles 150 n/a Soil Fumigation n/a 330 Cover Crop 12 12 Total: 1,422 757 Source: 2004 5 IFAS Citrus Production Budgets Table B 9 Property tax levy for top five citrus producing counties, 2003 C ounty Millage Rate A.P.R. (%)* Polk 17.322 1.73% Hendry 21.062 2.11% St. Lucie 20.855 2.09% Highlands 18.477 1.85% *A.P.R. is annual percentage rate of the millage rate converted into a percent source: Hodges et al. 2003

PAGE 111

111 Table B 10 Property tax analysis assumptions M ature Grove New Planting/Replanting Market Value $ 5,721.00 $ 2,934.00 A ssessment Value ($/acre) $ 3,600.00 $ 1,550.00 M illage Rate ($/$1000 of value) 19.5 19.5 E ffective A.P.R.(%) 1.95% 1.95% A nnual Property Tax ($/acre) $ 70.20 $ 30.23 Market value is 2003 value for Central Florida mature oranges and improved pasture for new/replanting Source: Hodges et al. (2003) and 2003 IFAS Florida Rural Land Value Survey Table B 11 USDA average yields by variety and production district, 1999 2004 average VALENCIA ORANGES 3 5 Years 6 8 Years 9 13 Years 14 23 Years 24+ Years Indian River 0.8 1.3 1.75 2.03 2.68 North&Central 1.03 1.72 2.45 3.59 5.67 Western 1.5 2.22 2.89 3.28 4.26 Southern 0.94 1.67 2.1 2.45 4.07 Statewide 1.09 1.73 2.28 2.83 4.33 EARLY/MIDSEASON ORANGES 3 5 Years 6 8 Years 9 13 Years 14 23 Years 24+ Years Indian River 0.65 1.51 1.87 2.49 3.03 North&Central 1.36 2.3 3.46 4.75 6.4 Western 1.27 1.74 3.33 4.58 5.32 Southern 1.14 1.9 2.82 3.62 4.11 Statewide 1.16 1.96 3.1 4.13 4.94 COLORED GRAPEFRUIT 3 5 Years 6 8 Years 9 13 Years 14 23 Years 24+ Years Indian River 1.41 2.18 3.14 4.37 5.01 North&Central 2.67 3.2 4.68 7.35 8.36 Western 2.43 1.64 4.27 2.68 7.18 Southern 2.96 4.1 4.11 4.72 5.67 Statewide 1.86 2.8 3.62 4.58 5.24 Source: 2003 4 Florida Citrus Summary

PAGE 112

112 Table B 12 Rootstock study for Valencia oranges on ridge and flatwoods sites AVON PARK (145 Trees/Acre) INDIANTOWN (102 Trees/Acre) SWINGLE CARRIZO SWINGLE CARRIZO SEASON TREE AGE Box/Tree P.S./Box Box/Tree P.S./Box Box/Tree P.S./Box Box/Tree P.S./Box 1980/81 1 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1981/82 2 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1982/83 3 0.24 6.56 0.26 6.57 0.00 0.00 0.00 0.00 1983/84 4 0.97 4.96 1.26 4.81 0.20 5.03 0.30 4.63 1984/85 5 1.04 5.92 1.57 5.82 0.40 5.03 0.80 4.63 1985/86 6 1.36 6.04 1.85 5.70 1.00 5.03 1.70 4.63 1986/87 7 1.58 6.14 2.93 6.22 1.60 7.68 2.20 8.04 1987/88 8 1.69 6.26 1.95 6.22 2.20 6.89 3.00 6.75 1988/89 9 3.25 5.98 5.62 5.89 3.60 5.94 4.60 6.21 1989/90 10 2.67 6.51 2.98 6.06 2.10 7.05 4.00 7.30 1990/91 11 4.06 6.54 6.00 6.44 3.00 7.15 4.60 7.60 1991/92 12 3.89 6.59 4.59 6.30 2.30 7.65 4.00 7.45 1992/93 13 3.75 6.56 5.65 6.37 4.50 6.94 6.70 6.69 1993/94 14 4.01 7.65 7.22 6.92 4.70 7.01 6.40 7.08 1994/95 15 3.91 7.18 6.53 6.78 3.00 6.77 5.30 6.91 Source: Dr. William Castle, IFAS Lake Alfred CREC Table B 13. Fruit and juice yield by variety used in the analysis Hamlin Orange Valencia Orange Colored Grapefruit Spacing: 22' x 10' 22' x 10' 25' x 13' Trees/Acre: 198 198 134 Tree Boxes P.S. Boxes P.S. Boxes Age Per Tree Per Tree Per Tree Per Tree Per Tree 1 0.00 0.00 0.00 0.00 0.00 2 0.00 0.00 0.00 0.00 0.00 3 0.55 5.00 0.46 5.00 0.68 4 0.91 5.25 0.77 5.50 1.14 5 1.28 5.50 1.08 6.00 1.60 6 1.73 6.00 1.47 6.50 2.17 7 2.19 6.25 1.85 7.00 2.73 8 2.55 6.25 2.16 7.00 3.19 9 2.92 6.25 2.47 7.00 3.65 10 3.28 6.25 2.78 7.00 4.10 11 3.61 6.25 3.06 7.00 4.51 12 3.61 6.25 3.06 7.00 4.51 13 3.61 6.25 3.06 7.00 4.51 14 3.61 6.25 3.06 7.00 4.51 15 3.61 6.25 3.06 7.00 4.51

PAGE 113

113 Table B 14 Mature grove production costs with canker by production region RIDGE FLATWOODS VALENCIA HAMLIN VALENCIA HAMLIN GFT Cultivation and Herbicide 189.17 189.17 189.17 189.17 189.17 Spray Program 132.24 132.24 141.19 141.19 383.17 Fertilization 204.77 204.77 204.77 204.77 157.00 Pruning 40.06 40.06 40.06 40.06 52.13 Irrigation and Ditch Maintenance 166.17 166.17 208.63 208.63 208.63 Miscellaneous 14.65 14.65 15.68 15.68 19.80 Supervision and Overhead 36.62 36.62 39.19 39.19 49.51 Water drainage Tax 60.00 Total Grove Care (before canker) 783.68 783.68 838.69 838.69 1,119.41 Additional Disease Related Costs Canker Field Inspections 17.52 17.52 17.52 17.52 17.52 Additional Spray Program 20.96 57.12 12.01 48.17 35.26 Citrus Canker Decontamination Costs 27.72 27.72 27.72 27.72 27.72 Yearly Cost to Establish & Maintenance for Windbreak 11.47 DPI Fresh Market Citrus Certification Costs* 60.00 Additional Packhouse Certification Costs* 40.50 Additional Supervision/Misc. Costs 4.63 7.17 4.01 6.54 13.47 Total Grove Care (after greening) 854.51 893.20 899.94 938.64 1,325.35 % Change from Base 9% 14% 7% 12% 18% Only incurred for fresh market fruit once trees reach commerical production age

PAGE 114

114 Table B 15 Mature grove production costs with greening by production region RIDGE FLATWOODS VALENCIA HAMLIN VALENCIA HAMLIN GFT Cultivation and Herbicide 189.17 189.17 189.17 189.17 189.17 Spray Program 132.24 132.24 141.19 141.19 383.17 Fertilization 204.77 204.77 204.77 204.77 157.00 Pruning 40.06 40.06 40.06 40.06 52.13 Irrigation and Ditch Maintenance 166.17 166.17 208.63 208.63 208.63 Miscellaneous 14.65 14.65 15.68 15.68 19.80 Supervision and Overhead 36.62 36.62 39.19 39.19 49.51 Water drainage Tax 60.00 Total Grove Care (before greening) 783.68 783.68 838.69 838.69 1,119.41 Additional Disease Related Costs Greening Field Inspections 35.04 35.04 35.04 35.04 35.04 Additional Spray Program 203.31 203.31 194.36 194.36 156.74 Additional Supervision/Misc. Costs 16.68 16.68 16.06 16.06 13.42 Total Grove Care (after greening) 1,038.71 1,038.71 1,084.15 1,084.15 1,324.61 % Change from Base 33% 33% 29% 29% 18%

PAGE 115

115 Table B 16 Mature grove production costs with canker and greening RIDGE FLATWOODS VALENCIA HAMLIN VALENCIA HAMLIN GFT Cultivation and Herbicide 189.17 189.17 189.17 189.17 189.17 Spray Program 132.24 132.24 141.19 141.19 383.17 Fertilization 204.77 204.77 204.77 204.77 157.00 Pruning 40.06 40.06 40.06 40.06 52.13 Irrigation and Ditch Maintenance 166.17 166.17 208.63 208.63 208.63 Miscellaneous 14.65 14.65 15.68 15.68 19.80 Supervision and Overhead 36.62 36.62 39.19 39.19 49.51 Water drainage Tax 60.00 Total Grove Care (before canker & greening) 783.68 783.68 838.69 838.69 1,119.41 Additional Disease Related Costs Canker/Greening Field Inspections 35.04 35.04 35.04 35.04 35.04 Additional Spray Program 203.31 203.31 194.36 194.36 156.74 Citrus Canker Decontamination Costs 27.72 27.72 27.72 27.72 27.72 Yearly Cost to Establish & Maintenance for Windbreak 11.47 DPI Fresh Market Citrus Certification Costs* 60.00 Additional Packhouse Certification Costs* 40.50 Additional Supervision/Misc. Costs 18.62 18.62 18.00 18.00 23.20 Total Grove Care (after greening) 1,068.37 1,068.37 1,113.81 1,113.81 1,474.08 % Change from Base 36% 36% 33% 33% 32% Only incurred for fresh market fruit once trees reach commer c ial production age

PAGE 116

116 Table B 17 Spray schedule and costs by variety and disease scenario Base Canker Greening Canker & Greening Type/Purpose Oranges* GFT Valencia Hamlin GFT Oranges* GFT Valencia Hamlin GFT Winter Early Spring 118.63 118.63 118.63 118.63 118.63 Systemic Insecticide (Temik/Admire) Psyllid control Spring Post Bloom (at first flush) 99.58 36.16 36.16 36.16 36.16 36.16 Oil/Copper Rust mite/Leafminer/Fungicide Spring Post Bloom (3 weeks after petal fall) 83.43 37.86 54.5 54.5 54.5 54.5 54.5 54.5 54.5 54.5 Copper/Micronutrients/Lorsban Leafminer/Rust mite/ Scale Spring Post Bloom (6 weeks after petal fall) 37.86 59.06 59.06 59.06 Copper/Micromite Scab/Melanose/Rust mite Summer (late May) 96.6 109.14 109.14 109.14 Oil/Miticide Rust mite/Scale Summer (late May/early June) 53.63 53.82 49.35 49.35 49.35 49.35 49.35 49.35 49.35 49.35 Copper/Oil/Miticide Rust mite/Scale/Fungicide Summer (early July/ mid August) 49.35 49.35 49.35 70.69 70.69 70.69 70.69 70.69 Oil/Copper/Lorsban/Micronut. Rust mite/Scale/Fungicide/Psyllid Fall (mid November) 57.46 60.87 42.38 42.38 42.38 42.38 42.38 Vendex or Danitol Rust mite/psyllid control TOTAL ($/acre) 137.06 383.18 153.20 189.36 418.43 335.55 539.91 335.55 371.71 539.91 Oranges not separated by variety because of identical spray programs. All orange costs representative of ridge source: IFAS 2004 5 Citrus Production Budgets adjusted by Ronald Muraro for recommended spray programs by disease

PAGE 117

117 APPENDIX C SELECTED RESULTS Results from various scenarios are shown in Tables C 1 through C 6.

PAGE 118

118 T able C 1 Tree age distribution of a solidset Valencia grove base scenario Age of Original Planted Trees PERIOD 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 0 0 1 0 1.000 2 0 0.000 0.990 3 0 0.020 0.000 0.980 4 0 0.000 0.020 0.000 0.970 5 0 0.025 0.000 0.020 0.000 0.956 6 0 0.000 0.025 0.000 0.019 0.000 0.941 7 0 0.029 0.000 0.024 0.000 0.019 0.000 0.927 8 0 0.000 0.029 0.000 0.024 0.000 0.019 0.000 0.913 9 0 0.029 0.000 0.029 0.000 0.024 0.000 0.018 0.000 0.900 10 0 0.000 0.029 0.000 0.029 0.000 0.023 0.000 0.018 0.000 0.886 11 0 0.015 0.000 0.029 0.000 0.028 0.000 0.023 0.000 0.018 0.000 0.873 12 0 0.000 0.015 0.000 0.028 0.000 0.028 0.000 0.023 0.000 0.018 0.000 0.842 13 0 0.039 0.000 0.014 0.000 0.028 0.000 0.027 0.000 0.022 0.000 0.017 0.000 0.813 14 0 0.000 0.038 0.000 0.014 0.000 0.028 0.000 0.027 0.000 0.022 0.000 0.017 0.000 0.784 15 0 0.050 0.000 0.038 0.000 0.014 0.000 0.027 0.000 0.026 0.000 0.022 0.000 0.016 0.000 0.757 Example: In year 7 of the analysis, 92.7% of the 7 year old originally planted trees remain. Additionally, 1.9% of 5 year old reset trees remain, plus 3 year old and 1 year old reset trees, with 2.5% and 2.9% remaining, respectively. Period of Analysis

PAGE 119

119 119 T able C 2 Yields for a solidset Valencia grove base scenario Age of Original Planted Trees Total Pound PERIOD Boxes/Age 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Boxes Solids 0 0.00 0 0.00 1 0.00 0 0.00 2 0.00 0 0.00 3 0.46 89 89 446.34 4 0.77 0.0 148 148 813.62 5 1.08 1.8 0.0 204 206 1236.92 6 1.47 0.0 2.9 0.0 274 277 1800.18 7 1.85 2.2 0.0 4.1 0.0 340 346 2421.59 8 2.16 0.0 3.7 0.0 5.5 0.0 391 400 2798.23 9 2.47 2.6 0.0 5.1 0.0 6.8 0.0 440 454 3181.09 10 2.78 0.0 4.4 0.0 6.8 0.0 7.8 0.0 488 507 3546.90 11 3.06 2.6 0.0 6.0 0.0 8.4 0.0 8.8 0.0 529 554 3880.25 12 3.06 0.0 4.3 0.0 8.1 0.0 9.7 0.0 9.7 0.0 510 542 3794.99 13 3.06 1.3 0.0 6.0 0.0 10.0 0.0 10.9 0.0 10.5 0.0 492 531 3718.47 14 3.06 0.0 2.2 0.0 8.0 0.0 11.5 0.0 12.1 0.0 10.2 0.0 475 519 3634.40 15 3.06 3.5 0.0 3.0 0.0 10.0 0.0 13.0 0.0 13.1 0.0 9.8 0 459 511 3576.40 Example: In year 7 of the analysis, the originally planted trees are seven years old, and produce 1.85 boxes per tree totalin g 340 boxes. Additionally, there are 5 year old reset trees producing 1.08 boxes/tree totaling 4.1 boxes, and 3 year old resets pr oducing .46 boxes per tree totaling 2.2 boxes. The total production for year 7 is 346 boxes per acre, or 2422 pound solids per acre. Period of Analysis

PAGE 120

120 Table C 3 Reset strategy beginning/ending tree distributions under disease scenarios Non bearing/ Empty Spaces 1 3 yrs 4 10yr s 11 15yr s 15+ yrs Total # of Bearing Trees Mature Grove Beginning Tree Age Distribution Valencia on Ridge Number 3 12 9 4 84 109 Percent 3% 11% 8% 3% 75% Mature Grove Ending Tree Age Distribution Valencia on Ridge With resetting & without greening Number 6 12 17 11 66 106 Percent 6% 11% 15% 10% 59% Without resetting & without greening Number 46 66 66 Percent 41% 0% 0% 0% 59% With resetting & with greening Number 10 19 25 13 44 102 Percent 9% 17% 23% 12% 40% Without resetting & with greening Number 68 44 44 Percent 60% 0% 0% 0% 40%

PAGE 121

121 Table C 4 Estimated breakeven price by scenario (Price* at which NPV of grove cash flows over 15 y ea r period is positive) RIDGE FLATWOODS INDIAN RIVER Valencia Hamlin Valencia Hamlin GFT New Plantings Base $1.40 $1.30 $1.50 $1.40 $10.00 Canker $1.50 $1.40 $1.60 $1.50 $13.00 Greening low $1.60 $1.50 $1.70 $1.60 $13.00 G&C low $1.70 $1.60 $1.80 $1.70 $15.00 G&C med $1.70 $1.70 $1.80 $1.80 $15.00 G&C high $1.90 $1.80 $2.00 $1.90 $17.00 Replantings Base $1.00 $0.90 $1.00 $1.00 $6.00 Canker $1.00 $1.00 $1.10 $1.10 $8.00 Greening low $1.20 $1.10 $1.20 $1.10 $8.00 G&C low $1.20 $1.20 $1.20 $1.20 $10.00 G&C med $1.20 $1.20 $1.30 $1.30 $10.00 G&C high $1.30 $1.30 $1.40 $1.40 $11.00 Mature Grove Base $0.60 $0.60 $0.50 $0.50 $4.00 (w/o land cost) Canker $0.60 $0.60 $0.60 $0.60 $7.00 Greening low $0.70 $0.70 $0.60 $0.60 $6.00 G& C low $0.70 $0.80 $0.60 $0.70 $8.00 G&C med $0.70 $0.80 $0.70 $0.70 $9.00 G&C high $0.80 $0.80 $0.70 $0.70 $9.00 Mature Grove Base $1.00 $0.90 $0.90 $0.90 $11.00 (with land cost) Canker $1.10 $1.00 $1.00 $1.00 $14.00 Greening low $1.10 $1.10 $1.10 $1.00 $13.00 G&C low $1.20 $1.20 $1.10 $1.10 $15.00 G&C med $1.20 $1.20 $1.10 $1.10 $15.00 G&C high $1.30 $1.30 $1.20 $1.20 $17.00 Price in $/P.S. for oranges, and $/on tree box (fresh) for GFT

PAGE 122

122 Table C 5 Average grove production costs by scenario and disease TYPE OF PLANTING/GROVE VARIETY LOCATION BASE CANKER GREENING LOW CANKER&GREENING LOW CANKER&GREENINGM ED CANKER&GREENING HIGH Cost/ Acre Cost/ Acre Base Cost/ Acre Base Cost/ Acre Base Cost/ Acre Base Cost/ Acre % Base NEW PLANTINGS/REPLANTINGS* VALENCIA RIDGE \ 873 873 9% 1,080 35% 1,080 35% 1,090 36% 1,124 41% NEW PLANTINGS/REPLANTINGS HAMLIN RIDGE 906 906 13% 1,080 35% 1,113 39% 1,122 40% 1,155 44% NEW PLANTINGS/REPLANTINGS VALENCIA FLATWOODS 912 912 8% 1,118 32% 1,118 32% 1,127 33% 1,160 37% NEW PLANTINGS/REPLANTINGS HAMLIN FLATWOODS 945 945 11% 1,118 32% 1,151 36% 1,159 37% 1,190 40% NEW PLANTINGS/REPLANTINGS GRAPEFRUIT INDIAN RIVER 1,268 1,268 26% 1,284 27% 1,394 38% 1,392 38% 1,387 38% MATURE PLANTINGS** VALENCIA RIDGE 932 932 8% 1,102 27% 1,105 28% 1,095 26% 1,068 23% MATURE PLANTINGS HAMLIN RIDGE 966 966 12% 1,102 27% 1,137 31% 1,126 30% 1,097 27% MATURE PLANTINGS VALENCIA FLATWOODS 999 999 6% 1,175 25% 1,179 26% 1,173 25% 1,157 23% MATURE PLANTINGS HAMLIN FLATWOODS 1,033 1,033 10% 1,175 25% 1,211 29% 1,204 28% 1,186 26% MATURE PLANTINGS GRAPEFRUIT INDIAN RIVER 1,340 1,340 22% 1,327 21% 1,432 30% 1,409 28% 1,347 22% New Plantings/Replantings production costs exclude year 1 establishment costs ** Mature grove averages production costs from 15 30 year old trees

PAGE 123

123 Table C 6 Average gove yields by scenario and disease TYPE OF PLANTING/GROVE VARIETY LOCATION BASE CANKER GREENING LOW C & G LOW C &G MED C & G HIGH Boxes/ Acre Boxes/ Acre Base Boxes/ Acre Base Boxes/ Acre Base Boxes/ Acre Base Boxes/ Acre Base NEW PLANTINGS/REPLANTINGS ** VALENCIA RIDGE 527 495 6% 488 7% 464 12% 450 15% 405 23% NEW PLANTINGS/REPLANTINGS HAMLIN RIDGE 622 553 11% 576 7% 518 17% 503 19% 453 27% NEW PLANTINGS/REPLANTINGS VALENCIA FLATWOODS 527 495 6% 488 7% 464 12% 450 15% 405 23% NEW PLANTINGS/REPLANTINGS HAMLIN FLATWOODS 622 553 11% 576 7% 518 17% 503 19% 453 27% NEW PLANTINGS/REPLANTINGS GRAPEFRUIT INDIAN RIVER 526 468 11% 487 7% 438 17% 425 19% 383 27% MATURE PLANTINGS *** VALENCIA RIDGE 290 271 7% 268 8% 255 12% 245 16% 220 24% MATURE PLANTINGS HAMLIN RIDGE 342 303 11% 316 8% 285 17% 274 20% 246 28% MATURE PLANTINGS VALENCIA FLATWOODS 375 351 6% 347 7% 330 12% 317 15% 285 24% MATURE PLANTINGS HAMLIN FLATWOODS 443 392 12% 409 8% 368 17% 355 20% 318 28% MATURE PLANTINGS GRAPEFRUIT INDIAN RIVER 362 321 11% 335 7% 302 17% 290 20% 260 28% ** New Plantings/Replantings yield averages for tree age 4 to 15 ** Mature plantings assume 119 trees/acre for ridge, 145 trees/acre for flatwoods, 95 trees/acre for GFT on flatwoods.

PAGE 124

124 LIST OF REF E RENCES American Institute of Real Estate Appraisers. The Appraisal of Rural Property Chicago: American Institute of Real Estate Appraisers 1983. th http://www.aphis.usda.gov/ppq/ep/citrus_greening/pdf_files/update3 16 06.pdf The Appraisal Institute. The Appraisal of Real Estate (12 th edition) Chicago: The Appr aisal Institute 2001. Land Economics v. 76, no. 1 (2000). pp. 1 14. Brealey, R.A. and S.C. Meyers. Principl es of Corporate Finance (7 th edition) Boston: McGraw Hill 2003. Minutes of 12 th Annual International Organization of Citrus Virologists (IOCV) Conference. (1995) pp. 269 275. Forest Science 26(1980):609 25. Citrus Education and Research Center Univ ersity of Florida, Lake Alfred, FL 1994 Proceedings of a Regional Workshop on Management of Banana and Ctirus Through the Use of Disease Free Planting Plant ing Materials Davo City, Philippines. October 1998. Florida Agricultural Statistics Service. Citrus Summary various issues Orlando, FL Department Press Release 01 11 2006a. omprehensive Report on Citrus 14 2006b. Ph ytopathology 92(2002a):361 377.

PAGE 125

125 Online. Plant Health Progress doi:10.1094/PHP 2002 0812 01 RV. 2002b.) ce of Corporate Finance: Evidence from Journal of Financial Economics v. 60 (2001). pp. 187 223. and Tax IFAS EDIS: FE437. 2003. IFAS EDIS: HS142, 1994. Jackson, L.K. and F. Davies. Citrus Growing in Florida 4 th Edition Gainesville : University Press of Florida, 1999 Farms of Guandong and Fujian by Combined Early Eradication with Targeted Insecticide Proceedings of 4 th International Asia Pacific Conference o n Citrus Rehabilitation Chiang Mai, Thailand. 1990. pp. 145 148. The Appraisal Journal 59(1991): 458 70. Canker Disease Caused by Xanthomonas campestris pv. citri Crop Protection 9(1990):3 7. Pest Management Guide: Use of Pesticides in IFAS EDIS: CG035, 2005 Agribusiness. 7 (1991): 327 38. Freeze University of Florida, Food and Resource Economics Department Staff Paper No. 270, January 1985. Muraro, R.P. Agricultural Sciences Circular: 333 (March 1989). Citrus Production 2004 AS EDIS: FE631, 2006a. 2004 IFAS EDIS: FE630, 2006b.

PAGE 126

126 Citrus Production 2004 IFAS EDIS: FE629, 2006c. Muraro, R.P. Lake Alfred Interview 2/21/2006 Lake Alfred Citrus Educatio n and Research Center 2006d. Citrus Production 2003 IFAS EDIS: FE528, 2005a. us Production 2003 IFAS EDIS: FE527, 2005b. Production 2003 IFAS EDIS: FE526, 2005c. Muraro, R.P. and S. Futch. Lake Alfred Interview 10/6/2005 Citrus Education and Research Center Lake Alfred, FL, 2005. Citrus Production 2002 IFAS EDIS: FE433, 2004. ns for Central Florida Citrus Production 2002 IFAS EDIS: FE432, 2004. Citrus Production 2002 IFAS EDIS: FE434, 2004. IFAS EDIS:FE365, 2003. IFAS EDIS: FE286, 2001. Proceedings of the Florida State Horticulture Society 109: 128 131. 1996. Mongi Z., T. A. Obreza and R. Koo. IFAS EDIS: SL207, 2003. IFAS EDIS: SL240, 2006. IFAS EDIS: SL193, 2002.

PAGE 127

127 IFAS EDIS: HS1026. 2006. IFAS EDIS: HS931, 2003. IFAS EDIS: FE214, 2000. IFAS E DIS: FE321, 2001. IFAS EDIS: FE360, 2001. IFAS EDIS: FE439, 2003. Reyno IFAS EDIS: FE545, 2005. IFAS EDIS: FE625, 2006. Management of A sian Citrus Psyllid Education Center, Lake Alfred, Florida, 2006. http://citrusbmp.ifas.ufl.edu/Workshop%20Presentations/Psyllid%20IPM.pdf Proceedings of the Florida State Horticultural Society 113(2000): Proceedings of the Florida State Horticultural Society 110(1997): 79 82. (Greening) in th Annual International Organization of Citrus Virologists (IOCV) Conference. (1996) pp. 279 284. EDIS: HS974, 2004. Sav Department Circular: 60 8, 1960.

PAGE 128

128 April 2001 (3 rd revision). Spreen T.H., W. Fernandes., C. Moreira, and R. P. Muraro. IFAS EDIS: FE 300, 2004. Spreen, T.H., et al. An Economic Assessment of the Future Prospects for the Florida Citrus I ndustry Food and Resource Economics Department, University of Florida, 2006. http://www.floridajuice.ifas.ufl.edu/pubs/EconAssessment.pdf Spreen, T.H., and R.P. Muraro, F.M. Roka IFAS EDIS: FE285, 2001. IFAS EDIS: CH147, 2001. Sto IFAS EDIS: CH145, 2001. Practices in the India IFAS EDIS: HS850, 2002a. Factors Influencing Spraying Efficiency and Off IFAS EDIS: HS128, 2002b. HS129, 2002. Free Seedlings Proceedings of a Regional Workshop on M anagement of Banana and Ctirus Through the Use of Disease Free Planting Planting Materials Davo City, Philippines. October 1998. of HLB, aiming at renovating old infected orchard, in epidemic zone and protecting non infected orchard in non Proceedings of the 6 th Annual Asia Pacific Workshop on Integrated Citrus Health Management Kuala Lumpur, Malaysia 1991. pp. 55 61. Zekri, M. and T.A. Obreza IFAS EDIS: SL200, 2003. Ziegler L.W. and T. Wolfe. Citrus Growing in Florida Gainesville: University of Florida Press, 1975.

PAGE 129

129 BIOGRAPHICAL SKETCH Jordan Malugen is a native of the s tate of California and complet ed his B achelor of A rts in International Political Economy at the Colorado College in Colorado Springs, Colorado. Prior to program, he held positions at the First National Bank in San Diego as an intern in both the foreign exchange and corporate lending areas, U S Foreign Commercial Service in Buenos Aires, Argentina as an intern, The Bank of New York, New York as an interna tional banking associate, DSF Global as head of finance and Peruvian market development manager, and Garuda Thai Corporation as office manager. During his time at the University of Florida, he was the recipient of the Ross Travel Award for research into t he Brazilian citrus industry in conjunction with the International Agricultural Trade and Policy Center (IATPC). Upon leaving the program, Mr. Malugen began working for Prudential Real Estate Investors Latin America where he is an associate portfolio mana ger. Currently, Mr. Malugen resides in Rio de Janeiro, Brazil.