Commodity Futures | Our Services

The world’s largest producers of oranges and frozen concentrated orange juice (FCOJ) are Brazil and the United States. Brazilian production is mostly in Sao Paulo, Brazil, where about 95 percent of the citrus trees are grown. Brazil is the largest producer of oranges and FCOJ, having passed Florida several years ago. The domestic market in Brazil generally prefers fresh oranges which are then squeezed for juice. Oranges that are processed for FCOJ are usually destined for export markets in the U.S., Europe and Asia. In the U.S., oranges for processing are growing for the most part in Florida. California, Texas and Arizona also grow oranges. The industry in Florida has been there for many years. Production has had several changes over the years. A series of freezes in the 1980’s led to the destruction of trees in the northern part of the state. The groves were shifted to the southern part of the state with the development of more sophisticated irrigation systems. An important development has been the increase in the number of trees grown on each acre. This increased density of the groves, along with the fact that they are located more to the south, means that there is much less chance that a freeze will damage the crop. For U.S. oranges, the most important report of each year is the October crop production report from the U.S.D.A. This is the first report of the season and as such provides the initial idea on how large the crop will be. For the 1999/2000 season, the U.S.D.A. in October estimated Florida production at 211 million boxes. This was some 14 percent more than the 1998/99 crop of 185.7 million boxes, but well below the 1997/98 record crop of 244 million boxes. The California crop was forecast at 67 million boxes, up 76 percent from last year’s weather damaged crop. The U.S. orange crop was forecast at 280.5 million boxes. In the U.S.D.A.’s December crop production report, the Florida crop estimate was increased to 214 million boxes. The early midseason Navel crop was estimated at 124 million boxes while the Valencia crop was forecast at 90 million boxes. The FCOJ yield was forecast to be 1.60 gallons per box. The Brazilian crop is always difficult to forecast. The U.S.D.A. agricultural attache reported that the 1999/00 (July-June) crop was expected to be 440 million boxes with FCOJ production of 1.27 million tonnes. The Sao Paulo area was expected to contribute 295 million boxes for processing. By mid-December 1999, the Brazilian Association of Citrus Exporters had reported that cumulative production of FCOJ was 1.04 million tonnes or some 7 percent less than that in the same period of 1998/99. The inventory was almost 784,000 tonnes, down 5 percent from the year before. Futures Markets Frozen concentrated orange juice futures and options are traded on the NYCE Division of the New York Board of Trade (NYBOT).

See also  Cattle

Excerpted from the CRB Commodity Yearbook.