Central Valley almond grower Trinitas Farming, its investment organization and 17 subsidiary almond ranches have filed for Chapter 11 bankruptcy protection in San Jose, Calif.

Paperwork was filed Feb. 19.

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Sustained record low almond prices, high interest rates and the rising cost of capital contributed to the bankruptcy, according to the filing. Chapter 11 allows a company to reorganize its finances.

Trinitas Farming’s almond operation, organized in 2015, covers 7,856 acres in Solano, Contra Costa, San Joaquin, Fresno and Tulare counties.

According to the filing, the operation was well-positioned to become profitable because of Trinitas’ experience and expertise in managing ag investments and operations, the farms’ superior water rights and the young age of the almond orchards — which makes them valuable for long-term growth.

In the end, the partners and lender Rabo AgriFinance determined the best course was to file for bankruptcy to facilitate a managed sale process.

A call seeking comment from the law firm representing Trinitas Farming was not returned.

Industry problemsThe bankruptcy highlights problems facing almond farmers.

A period of explosive growth in bearing acreage and production coincided with a shrinking price per pound.

About a decade ago, California almonds reached 900,000 acres of bearing trees, which are four years or older, according to the USDA.

Demand was high at the time, with prices reaching a record high of $4 per pound in 2014. A crop of 1.87 billion pounds led to a harvest worth a record $7.39 billion.

Plantings ramped up, and in 2023, California had an estimated 1.36 million acres of bearing almond trees.

However, the price per pound dropped, hitting $1.40 in 2022 — the lowest mark since 2002 — and the crop was only worth $3.52 billion.

The state saw its highest production ever in 2020 with 3.12 billion pounds, but the harvest has dropped since then.

Non-bearing trees also hit a record 350,000 acres that year, but have shrunk since, dropping to 280,000 acres by 2022.

A turning point?Rick Kushman, Almond Board of California spokesman, said the organization, as a federal marketing order, was limited in what it could say in regards to the bankruptcy or pricing issues.

But he said a RaboResearch Food & Agribusiness report predicted a rebound in price in the next year to 18 months.

A summary of the firm’s five-year almond market outlook anticipated that ending stocks will hit their lowest level in four years as global demand returns.

The pandemic damaged shipping capacity and work-from-home meant people weren’t snacking on almonds as much in the office, which led to an oversupply, Kushman said in a previous interview.

“The lower carry-in expected in 2024 and its powerful, multiyear impact on the market are setting the stage for potential price stabilization at stronger levels,” the summary stated.

Kushman said recent marketing efforts by the California Almond Board, including those featuring University of Colorado football coach Deion Sanders, have been effective.

“Coach Prime certainly brought more attention to California almonds than any one campaign,” Kushman said.