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ORANGE CROP UPDATES - Q3 2024

USA

The USDA’s second-to-last forecast for Florida’s 2023/24 orange crop has been slightly lowered. Analysts in the US believe these final adjustments are merely end-of-season bookkeeping and do not anticipate further changes in the upcoming July report. Growing conditions in Florida for the 2024/25 season are not as dry, with substantial rainfall, especially in the southern part of the state. Despite the warm climate, increased cloud cover has provided some cooling. The fruit set for the 2024/25 crop is reportedly weak in the south, but local sources hope production in other parts of Florida will compensate, though they expect the overall crop size to be similar to this season’s.

 

MARKET DRIVERS

Analysts are closely monitoring weather patterns as the hurricane season approaches. Recently, Storm Alberto moved into Mexico, bringing beneficial rain. The weather in Brazil is also a focal point for the industry now that the 2024/25 crop has begun there. Any supply updates from Florida will be notable, though summer in the US usually remains slow until late summer when tree strippings provide more clarity on the next crop. Analysts have not observed significant retail price increases yet but expect higher fruit prices to eventually lead to higher juice prices, with the market keen to see the impact on consumption.

MEXICO

The 2024 orange season in Mexico concluded in late May/early June, with few processors handling the very mature fruit (+40 ratio). Local processors estimate that the 2024 Valencia orange crop production was 18% higher than in 2023, and orange juice production increased by 39%. Due to low availability, FCOJ pricing in Mexico is strong, despite future market volatility. Current offers for Mexican FCOJ range between USD 4.70-4.80/lb solid ex-works Mexico, and NFC supplies are offered at USD 4.70/gallon ex-works. Limited volumes of FCOJ are available, and the remaining NFC supplies are of very high quality. Although demand is strong, buyers are cautious about committing to large volumes due to high prices, preferring to work on a month-by-month basis in hopes that prices will ease. However, processors do not expect price relief until June 2025, contingent on a very good crop in Brazil next year. Despite a strong uniform bloom in February/March, Mexico experienced extreme drought from April to early June, affecting fruit set and causing significant fruit drop. Tropical storm Alberto brought much-needed water, but an active hurricane season poses further risks for the 2024 crop.

BRAZIL

Brazil’s main growing regions remain slightly too dry with higher- than-usual temperatures for this time of year. No rain is forecast and soil moisture retention is low, raising concerns about fruit maturation. Fundecitrus’s May estimate for the 2024/25 crop was 232 million boxes, lower than expected and historically small, coming at a time when global stocks are critically low. Industry sources continue to use the 232 million-box figure but warn that persistent dry conditions could lower it further. Most processing plants are now running fruit from the 2024/25 crop, leading to strong competition between factories and increasing fruit prices to BRL 90-100/box from BRL 80-85/box last month. The competition for fruit and the increasing prevalence of greening disease, which causes premature fruit drop, have led to early harvesting, resulting in lower ratio supplies, with early fruits at a 10-14 ratio and Valencia’s at a 6-7 ratio. Juice yields are currently at 290-320 boxes per MT* of FCOJ.