(Bloomberg) — Orange juice futures rose for a second straight day as production is expected to slow in Florida after Hurricane Milton knocked fruit off branches and left citrus trees lying on the ground.
More than three million boxes of oranges may have been lost since the powerful storm hit key citrus-producing counties last week, industry consultant Judy Ganes said. That means Florida’s next crop will likely be the worst since the late 1920s, he added.
The most active orange juice contract rose as much as 3.3% on Monday in New York. Prices hit a record high last month due to tight global supplies and a drought that reduced production in Brazil, the world’s top exporter.
Florida is the largest producer of oranges for juice in the country and the second largest orange-producing state in the United States after California. Milton arrived as the state’s growers were counting on a turnaround after making progress in fighting the citrus greening disease that has decimated groves, and as trees were beginning to recover from Hurricane Ian two years ago.
The setback was also accompanied by a weaker-than-expected forecast for Florida’s crop. Even before accounting for the damage caused by Milton, the U.S. Department of Agriculture on Friday estimated the state’s orange production at 15 million boxes in its first forecast for the 2024/25 crop year. This is already the worst harvest since 1933.
The USDA data also did not indicate any significant improvement in fruit size, which the industry considers a sign of how healthy the crops are. Greening can result in smaller oranges.
“We expected that the oranges would have a better size and that the fruit would fall less,” Ganes said. “It turns out that the number of pieces to fill a box has increased.”
–With the help of Ilena Peng.
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