Note 2. Inventories

Inventories consist of the following at December 31, 2020 and September 30, 2020:

The Company records its inventory at the lower of cost or net realizable value. For the three months ended December 31, 2020 and the year ended September 30, 2019, the Company did not record any adjustments to reduce inventory to net realizable value. 

The Company was eligible for Hurricane Irma federal relief programs for block grants that were being administered through the State of Florida. During the fiscal years ended September 30, 2020 and 2019, the Company received approximately $4,629,000, of which approximately $4,466,000 was received during the quarter ended December 31, 2019, and $15,597,000 under the Florida Citrus Recovery Block Grant (“CRBG”) program. These federal relief proceeds represented Part 1 and Part 2 reimbursement under the three-part program. In the quarter ended December 31, 2020, the Company received approximately $4,136,000, representing reimbursement under Part 3 of the program. These federal relief proceeds are included as a reduction to operating expenses in the Condensed Consolidated Statements of Operations.