Commodity Blog

Commodity news, technical and fundamental analysis, market data on precious metals, energies, industrial metals, and soft commodities


Orange Juice Futures Flat on USDA Report

November 9, 2017 at 17:37 by Andrew Moran

Orange juice futures are trading relatively flat on Thursday following the release of a new report from the US Department of Agriculture (USDA). The US government published its monthly world supply-and-demand report that examined important US orange crop information.

January orange juice futures rose $0.005, or 0.03%, to $1.608 per pound at 16:20 GMT on Thursday on the ICE Futures exchange. Year-to-date, orange juice prices have tumbled more than 13%, despite the bump over the last two months.

According to the USDA, orange farmers are projected to produce 97.65 million boxes in the 2017–2018 crop season, down from 101.659 million boxes from the previous season. The forecast is substantially down from the 2015–2016 season that saw output top 141 million boxes.

Florida orange growers have seen their crops decrease in recent years over a myriad of reasons. Citrus greening, bacteria that causes oranges to drop before they are ripe, have eaten away orange supplies. Weather events, including Hurricane Irma in September, which generated close to $1 billion in losses, have impacted the Sunshine State’s crops.

Florida is hanging on by a thread, prompting lawmakers to offer the citrus industry $2.5 billion in relief aid.

Another issue that is affecting farmers is the decline in demand for orange juice. The once classic breakfast staple has seen its sales decrease about 8% as American consumers turn to healthier beverage alternatives, like sparkling water.

Experts have further warned that there may be a shortage of orange juice in your local supermarket. Since California is forecasting a reduction in citrus production and Florida unable to keep up with demand volumes, orange juice prices could jump in the coming months. Some analysts are hopeful that Brazil output may cover any potential shortfall that may arise in the rest of 2017 or next year.

If you have any questions and comments on the commodities today, use the form below to reply.

Leave a Reply