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Orange Juice Prices Drop over Supply Woes, EU Trade War

July 13, 2017 at 16:53 by Andrew Moran

Supply concerns and fears over a potential trade war with the European Union (EU) are contributing to orange juice’s woes in 2017. Orange juice prices have been unable to initiate any significant momentum this year – last year, the commodity surged roughly 20%.

September orange juice futures tumbled $0.055, or 0.43%, to $1.282 per pound at 16:35 GMT on Thursday on the ICE Futures exchange. At the same time a year ago, orange juice prices were trading at about $1.80, eventually peaking at $2.05 in November.

Orange juice’s recent trading patterns relate to Brazilian exports and tensions between the EU and the US.

Brazil’s orange juice exports totaled 890,000 tons from July 2016 to June 2017. This represents a 17% decline from the previous year and is the lowest level in 25 years. Industry experts say that the reduction in exports stem from a decrease in production, but recent reports say that output levels will grow by 50% year-over-year. Brazil is the largest orange producer in the world.

Florida may have to defend its orange juice in the coming months. Former US Democratic Representative Gwen Graham is urging the Florida Agriculture Commission to promote the state’s orange juice if President Donald Trump commences a trade war with the EU. The European trade bloc confirmed it would prohibit US orange juice imports if Trump starts a steel trade war.

Orange juice is absolutely vital to Florida’s agriculture industry and our state’s economy. [Commissioner] Adam Putnam needs to put Florida first, pick up the phone, call his friend Donald Trump and defend our state’s jobs.

The classic breakfast staple is also having to contend with slumping sales. In April, it was reported that total US sales of orange juice plunged 7.6% to 33.36 million gallons. During the 2016–2017 season, orange juices have tumbled 7.4%, while frozen orange juice sales dipped 9.3%.

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