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Citrus disease and bad weather are constraining supply of oranges in the United States and internationally. Meanwhile, demand for orange juice — which has been sliding for years — got a bump during the pandemic.
That has sent orange juice prices higher during the pandemic, and they will probably continue to climb: Frozen orange juice futures have surged more than 50% during the pandemic, and they rose to a two-year high last week — soaring 5% alone Thursday.
“You have your classical supply-demand mismatch,” said Shawn Hackett, president of Hackett Financial Advisors, which specializes in agricultural commodities analysis. Because of that, consumers should expect “much higher prices at the supermarket.”
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Last week, the USDA said it expects Florida to produce 44.5 million boxes of oranges this year, an unusually small harvest. That would be the smallest since the 1944-45 season when 42.23 boxes were produced, a Florida statistician with the USDA told CNN Business.
“The Florida citrus crop is going to be one of the smallest crops since the 1940s,” said Judith Ganes, president of J Ganes Consulting, which offers commodities analysis to the food and agriculture industry. “It’s going to be even smaller than the production that occurred several years ago … when Hurricane Irma blew through Florida,” she said.
Florida’s orange crops, which are responsible for most of the country’s orange juice, have been dwindling for years, she noted. One culprit is an insidious citrus disease, referred to as citrus greening, which leads to smaller oranges and less fruit per tree.
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- Discussion
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Citrus disease and bad weather are constraining the supply of oranges. Meanwhile, demand for orange juice got a bump during the pandemic. https://t.co/NEPXlGVNsn
— CNN (@CNN) January 19, 2022
I’m suspicious of every reason (excuse?) for raising prices these days. I wonder how much of these increases have to do with COVID and how much of it is price gouging — taking advantage of tough times. At least the citrus industry isn’t blaming COVID. But it has in the past used other suspicious “reasons” for increasing prices. Some years it will blame unusually frigid temperatures ruining the crop for juice. Yet, frost-damaged citrus can still be used for juice. I’d like to see government put some time and money into investigating these increases, but it’s been over a year and it still hasn’t gotten around to prosecuting the major players in the 1/6 coup attempt yet. I won’t hold my breath waiting for the government to look into price gouging.
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