Company: LANDO
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001495240-25-000028
Chunk: 128

Company: GLADSTONE LAND Corp
Filing Date: 2025-11-05
Form: 10-Q
Item: Part I, Item 8
Chunk 128
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 October 2025, bringing the range to 3.75% to 4.00%.  These actions marked the first sustained rate-cutting phase since 2024 and reflected the Fed’s effort to support slowing economic growth while maintaining flexibility in response to persistent inflation pressures.  Benchmark yields have declined modestly in response, with the 10-year U.S. Treasury yield recently fluctuating around 4.0%, compared with levels consistently above 4.4% earlier in the year.  Although borrowing costs have eased somewhat, credit availability remains selective, and long-term spreads continue to reflect lender caution.  As a result, while financing conditions have improved relative to a year ago, access to debt on favorable terms remains uneven and continues to limit our ability to pursue new farmland acquisitions.

Currently, over 99.9% of our borrowings are at fixed rates, and on a weighted-average basis, these rates are fixed at an effective interest rate of 3.39% for another 3.0 years.  As a result, our existing debt portfolio has remained largely insulated from recent interest rate volatility, and we believe we are well positioned to withstand a potential prolonged period of elevated interest rates.

28

Tariffs and Trade

Ongoing trade tensions and the implementation of new tariffs continue to introduce uncertainty into U.S. agricultural exports markets.  Certain crops grown on our farms, including almonds and pistachios, are particularly exposed to these risks, as approximately 60% to 80% of U.S.-produced almonds and pistachios are exported annually.  In contrast, crops with strong domestic demand, such as fresh produce (including berries and vegetables), are generally less affected by trade-related disruptions.

Although international trade developments have influenced sentiment in export-oriented crop markets, pricing for almonds and pistachios continues to be primarily driven by underlying supply and demand fundamentals.  With the field harvest now complete, final 2025 almond production is expected to come in below initial industry forecasts, contributing to upward pricing pressure.  As a result, current almond prices are approximately 15% to 25% higher year-over-year.  While post-harvest hulling and processing activities remain underway, preliminary results indicate that production volumes on our farms have exceeded our initial internal expectations.  The crop is currently being marketed and sold, with first payments expected within the next three months and continuing through next fall.

Pistachios continue to experience strong demand, particularly in international markets.  Demand for pistachio-based ingredients is also