Orange Juice Prices Near Record Highs Amid Fears Of Worst Florida Harvest In A Century

Orange Juice Prices Near Record Highs Amid Fears Of Worst Florida Harvest In A Century

Frozen concentrated orange juice futures on the Intercontinental Exchange in New York are nearing new record highs. The squeeze in the physical markets may drastically worsen after a new citrus grove survey damage report across Florida following Hurricane Milton shows widespread damage.

Industry consultant Judy Ganes told Bloomberg that more than three million boxes of oranges may have been lost after Milton knocked fruit from branches and devastated citrus groves in the Sunshine State. She warned the next Florida harvest could be the worst since the late 1920s. 

In recent years, Hurricanes Ian and Nicole, freezing conditions, and citrus greening disease have decimated citrus groves in the state. Milton has only exacerbated those problems. Some of the latest industry figures show that US orange production is set to reach its lowest level in more than a century. 

OJ futures have surged to $5/lb, a staggering 433% jump from the Covid lows of around $1/lb. Worsening supply woes could push prices even higher. 

Meanwhile, data from the US Department of Agriculture shows that OJ cold storage levels were at their lowest point since the early 1970s. 

Brazil, the world’s top OJ producer, has ramped up OJ shipments to the US to offset sliding Florida production. But now, as we noted last month, Brazil has been hit by a devastating drought and widespread crop disease that has severely impacted yields across citrus groves. 

Rabobank analyst Andrés Padilla warned that Brazil has slipped into the “worst drought in 50 years” and “there’s really been very, very little rain across the citrus belt in the last four months, which is an important period.”

Padilla said, “The smallest crop in 35 years, plus rising citrus greening disease, plus drought — it’s the perfect storm,” adding, “The market is really stressed.”

“There’s no juice in the market,” Padilla warned, explaining, “That’s why we’re back to record high prices.” 

This only means OJ supermarket prices could scream higher from here. Global inflation jumped the most in 18 months in September. 

Whoops. 

VP Harris has offered a potential policy response of Communist-style price controls. This is a terrible idea because these types of policies create shortages.

Meanwhile, egg prices at the supermarket…

About a year ago, Sara Menker, founder and CEO of Gro Intelligence, warned in a Bloomberg interview that the current global food crisis is ‘much worse than 2008’. 

Tyler Durden
Wed, 10/16/2024 – 06:45

via ZeroHedge News https://ift.tt/ICXdQa4 Tyler Durden

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