Orange-juice futures jumped to a five-month high in New York after frigid weather damaged citrus crops in Florida, the world’s second-biggest grower.
Temperatures in about 75 percent of the state’s citrus-growing region were cold enough for frost, with a hard freeze in about 25 percent of the area, forecaster MDA EarthSat Weather said today in a report. Damage isn’t expected to be significant or widespread, Don Keeney, a senior agricultural meteorologist at EarthSat, said in the report.
“There’s definitely going to be some damage to the crop,” Michael Smith, the president of T&K Futures and Options in Port St. Lucie, Florida, said in a telephone interview. The frost probably will mean lower yields in the U.S. Department of Agriculture’s February crop report, he said.
Orange juice for March delivery rose 2.9 percent to settle at $1.7805 a pound at 2 p.m. on ICE Futures U.S. in New York, after gaining as much as 5 percent to $1.817, the highest for a most-active contract since Aug. 5. Prices have rallied 9.1 percent in the past two weeks.
Conditions are expected to moderate quickly, and freeze threats will ease as milder weather returns, according to Gaithersburg, Maryland-based EarthSat.
The Florida citrus industry generates $9 billion a year in economic activity and employs almost 76,000 people, according to Florida Citrus Mutual, a trade organization in Lakeland. The industry “came through in pretty good shape” after the frost, said Andrew Meadows, a spokesman for the group.
While the overall impact of the cold probably won’t be significant, low-lying areas likely bore the brunt of any damage, according to Ray Royce, the executive director of the Highlands County Citrus Growers Association in Sebring, Florida.
“We could see some fruit affected in cold pockets,” Royce said in a telephone interview, citing conversations with half a dozen growers. Cold weather is expected again tonight for Highlands County, in central Florida, “so we will have to assess the impact” further tomorrow, he said.
Brazil is the world’s top orange grower.