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Current Position:Home » News » Processed Foods » Topic

Limited global supplies continue to support orange juice prices

Zoom in font  Zoom out font Published: 2023-08-23  Origin: mintecglobal.com
Core Tip: Global orange juice production for the 2022/23 marketing year has seen a downturn of 9%, with total production at 1.5 million tonnes.
Global orange juice production for the 2022/23 marketing year has seen a downturn of 9%, with total production at 1.5 million tonnes. Despite robust global orange juice consumption, exports are expected to fall due to constrained global supply, according to the USDA. Brazil is the biggest orange juice producer and exporter, accountable for over 70% of the world's orange juice market.

Brazil, Mexico, the EU and the US have all experienced diminished orange crop yields for the 2022/2023 marketing year (MY). The US has increasingly turned to Brazil as the US orange crop has been devastated by extreme weather and greening disease in recent years. According to USDA data, orange juice production in the US has dropped by 47% for 2022/23 MY compared to 2021/22 MY, further tightening the global supply and demand scenario that continues to drive prices upwards.

Market sources report that major European retailers are wary of committing to contracts at these elevated price levels. The Mintec Benchmark price for Brazilian orange juice concentrate [Mintec code: 4Q04] in July reached $3,770/mt, up 83% y-o-y. Despite these high prices, demand from buyers in the free-buy market remains robust. Market sources suggest that prices are poised to reach higher levels in August In terms of production, it is unlikely the situation will improve soon, so it is expected by market sources that the only time there will be price relief is when consumers are unwilling to pay the high prices and demand drops.

Looking ahead, the forecast for Brazil's 2023/24 crop, according to the latest Fundecitrus forecast, stands at 309 million boxes, slightly below the previous season's yield. While considered a fair crop for Brazil, market sources express reservations about the crop's size being insufficient to replenish dwindling juice stocks.
 
 
 
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