Investment Methodology – Bottom – up/competitive advantage
Without question, the experts at ABF are using a bottom up investment strategy. The staff has over 40 years of accumulated experience. They have been raised in agricultural, educated in agricultural, and have decades of credit experience in their foundation of expertise.
ABF sees the investment opportunities on a daily bases. From the credit standpoint, William Van Tassel, has analyzed financial information, cash flow budgets, commodity production reports and appraisal reports for over 20 years. Commodities lent on include all the major commodities grown in California and nearly every specialty crop grown.
This behind the scenes education equates to an unprecedented competitive advantage when analyzing the relative profitability of commodities within the agricultural sector. Moreover, this expertise was obtained in the most diverse commodity growing region in the world – California’s Central Valley.
Issues to consider when selecting a commodity include the following: (1) the relative position of the commodity within its economic cycle (2) likelihood of future profitability (3) supply side analysis (e.g. acreage planting reports) (4) micro climates (5) water availability, quality and price (6) soil types (7) the value of the US dollar, and 8) potential foreign competition