– A lien for the supplier of agricultural inputs for production of livestock or crops
As we discussed, the agricultural production lien-notification can provide additional security on a debt for chemicals, feed, seed, petroleum, electricity or labor used in the production of livestock or crops. However, the lien-notification statement does not perfect the lien. To perfect the lien, the supplier is required to file a financing statement similar to the statements used in the other types of ag liens.
The agricultural production lien is perfected by filing a UCC article 9 financing statement within 3 months of the last date which the input was provided. The financing statement must contain (1) the name and business address of any lender; (2) the name, address and signature of the supplier; (3) a description and date of the transaction and retail cost of the transaction; (4) the name, address, and signature of the individual who received the input; (5) the name and address of the owner and description of the real estate where the crop was produced or description of the real estate where the livestock is raised and a description of the livestock produced; (6) a statement that the crop and livestock products and proceeds are covered by the lien; (7) the social security number or tax identification number of the individual who received the input; and (8) the social security number or tax identification number of the supplier.
The lien attaches on the date the input was furnished and to the following:
- The date the chemical was applied to an existing crop, or if not planted the next crop produced on the land where the chemical was applied (within 16 months of application)
- The crops produced from the seed furnished by the supplier;
- The crops produced, harvested, or processed using the petroleum or electricity furnished by the supplier. The lien does not apply to the lessor’s portion if the crops were grown on leased land.
- Livestock which consumes the feed. The lien continues through the products and proceeds from the livestock.
Although the agricultural production lien seems a bit intense and time-consuming, the lien may provide the security necessary to collect on an outstanding debt. The supplier with a properly perfected agricultural production lien will have the advantage, when resources are tight and a customer has to decide which bills to pay.