WSJ: Orange Juice Prices Soar Amid Weak Crop Forecast
By Max Rothman
A bacterial disease damaging Florida’s citrus groves has caused a spike in orange juice prices, according to an article by reporter Leslie Josephs of The Wall Street Journal. The damage could diminish the crop to its lowest level in 25 years.
While demand for orange juice is at an all-time low, pricing could still rise because of the amount of damage to crops as well as the imminent winter months, according to growers and investors cited in the article. The disease, citrus greening, is spread by an insect known as the Asian citrus psylid and “reduces the quantity and quality of citrus fruits, eventually rendering infected trees useless,” according to the U.S. Department of Agriculture (USDA).
Orange juice futures have increased more than 7 percent since Friday, the article says, when the USDA projected Florida growers would produce fewer oranges this season compared to any time since 1990.
“We’re very concerned about the crop levels,” Kevin Kerry, a trader and president of Chicago-based advisory firm Kerry Trading International, told The Journal.
Dry weather has also weakened the productivity and immunity of Florida’s trees, Michael W. Sparks, chief executive of Florida Citrus Mutual, a growers group, said in the article.
The agricultural issues come at an equally difficult time for the orange juice market, which has deflected consumers with high price points. The article notes that U.S. retail sales of orange juice dropped to the lowest level in at least 15 years in the previous 12 months ending in September, according to Nielsen.