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Orange Juice Flat As USDA Revises 2018–2019 Crop Downwards

June 12, 2019 at 16:15 by Andrew Moran

Orange juice futures are relatively flat midweek after the US government revised this season’s crop by 1% in June. While Florida’s orange industry is incrementally rebounding, there was news that Brazil is looking to China as a key market for its orange output. This could be a negative trend for the Sunshine State since it is already contending with slumping sales, bad weather, and disease.

July orange juice futures rose $$0.001, or 0.1%, to $1.0355 per pound at 15:50 GMT on Wednesday on the US ICE Futures exchange. Orange juice prices have had a horrific first half, plunging nearly 18%. Although there have been some periodic upward movements, the agricultural commodity has been unable to keep up the momentum. Over the last 12 months, orange juice is down 33%.

According to the US Department of Agriculture (USDA), Florida’s orange crop for the 2018–2019 season declined by 1% to 71.4 million boxes in June, from 72.4 million boxes in May.

Researchers say that the drop was related primarily to the late-season Valencia orange crop that stands at 41 million boxes. This type of orange is typically picked between March and June. The early- and mid-season orange crop, which is harvested from October to March, stayed put at 30.4 million boxes.

The monthly USDA report also highlighted that 96% of this season’s Valencia crop had been picked, the 2019–2020 grapefruit crop dipped 2% to 4.51 million boxes, and the 2019–2020 tangerine and tangelo crop fell 1% to 990,000 boxes.

Meanwhile, US orange juice sales, though still negative, appear to be picking up, according to new Nielsen data that was collected by the Florida Department of Citrus. In the four-week period ending May 11, US retail orange juice sales dipped just 0.5% to $204.85 million.

Recently, the Brazilian Association of Citrus Exporters (Citrus BR) said that its mission to China last month, which was arranged by the nation’s foreign and agriculture ministries, was a success because it will be expanding orange juice exports the world’s second-largest economy. Moving forward, Brazilian processors will be selling bulk tanker ships instead of drums to the biggest Asian market.

In other agricultural commodities, July corn futures tacked on $0.0475, or 1.11%, to $4.325 per pound. July wheat futures jumped $0.0675, or 1.3%, to $5.2475 per bushel. July soybean futures spiked $0.2275, or 2.65%, to $8.82 a bushel.

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