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Commodities Outlook: OJ Prices Soar Along With Beef And Pork

Posted by: : Paul EbelingPosted on: April 11, 2014 Commodities Outlook: OJ Prices Soar Along With Beef And Pork

Commodities Outlook: OJ Prices Soar Along With Beef And Pork

Total US  production of Oranges in the C-Y 2013–2014 (crop year) is now estimated at about 7.2-M tons, more than 1-M tons below last year’s total of 8.3-M tons. And almost all of  the fall is attributable to a production drop in Florida.

The US Department of Agriculture (USDA) released its monthly crop production report Wednesday and forecast Florida production at 110-M 90-lb boxes for the C-Y ending in September.

According to the data that is down 12% from the USDA’s original estimate and the smallest crop since C-Y 1984–1985.

The decline is due to an outbreak of a disease known as citrus greening. Officially known as Huanglongbing (HLB) was first reported in Florida in Y 2005. The bacterium causes trees to produce less, smaller, and bitter fruit. After a few years HLB kills the trees.

According to a recent report, about 50% the trees in every citrus orchard in Florida are affected by this incurable disease.

Since late October Orange Juice (OJ) prices have risen from around 1.20 lb to more than 1.60 lb.

The only thing keeping prices from rising more is lower demand. OJ sales fell 5.3% in the 4-wk period ending 15 March, according to a recent report.

Orange groves in California, Georgia, Louisiana and Texas have also been hit by HLB, as have orchards in many other parts of the world, including Brazil, which supplies about 20% of the US demand for Orange Juice.

US consumers are also paying more for Beef and Pork. Rising prices for OJ will put more pressure on household budgets.

OJ for May settlement traded Thursday at 1.6345 lb.

Stay tuned…


Paul Ebeling


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Paul Ebeling

Pattern Recognition Analyst, equities, commodities, forex
Paul Ebeling is best known for his work as writer and publisher of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly-regarded, weekly financial market letter, where he enjoys an international audience among opinion makers, business leaders, and respected organizations. Something of a pioneer in online stock market and commodities discussion and analysis, Ebeling has been online since 1994. He has studied and worked in the global financial and stock markets since 1984.

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