US orange juice prices reached their highest level on Thursday, buoyed by anemic crop prospects, amputated by the so-called yellow dragon disease and several devastating weather episodes.
The frozen orange juice and concentrate futures contract for March delivery, the current market benchmark on the Chicago Stock Exchange, rose to $2.4385 a pound (about 450 grams) for the first time. In one week, prices rose more than 17%.
Florida crop expected to drop 56%
In mid-January, the US Department of Agriculture said it was forecasting a 2022-2023 Florida crop that was 56% lower than the previous year, the lowest since World War II. Taking the 2020-2021 season as a comparison, volumes are even expected to decline by two-thirds (66%). The first culprit, the so-called yellow dragon disease, also called Huanglongbing disease (HLB), which can disrupt citrus ripening and cause premature fruit drop.
It is carried by the psylla, a tiny insect that carries a bacterium that feeds on the sap, interrupts the growth of the fruits and even causes the death of the tree. There is still no cure for this disease, which was first detected in Florida in 2005 and has since infected most orchards in the state. Added to the disease was the passage, in Florida, of Hurricane Ian, at the end of September, which notably crossed Polk County, the first producing region in the State.
In early November, Hurricane Nicole also swept through central Florida, the heart of orange growing, again causing thousands of fruits to drop prematurely. “Supply is contracting,” said Judy Ganes of J Ganes Consulting, especially as the yellow dragon disease is also affecting Brazil, the world’s largest producer of oranges. “And as it stands, there’s no hope of that changing.”
Source: BFM TV
