Orange prices could climb further after bad season
Some Florida orange growers are expecting a bad citrus season due to droughts, hurricanes, tree disease and urban sprawl â with juice prices already eight per cent higher than in 2005 and likely to climb more.
Florida is second only to Brazil in global orange juice production and puts out more than 90 per cent of all juice consumed in the United States. Meanwhile,Canada imported $127 million in orange juice and concentrates in 2004 alone, according to the Department of Foreign Affairs and International Trade.
But as the October harvest approaches, theprice of future-delivery juice contracts on the New York exchange have reached record highs. If the worst predictions of a crop shortage come true, the cost to consumers will follow suit.
Orange juice retail prices are already up eight per cent this year over last, and consumers have responded by buying less (a seven-per-cent dip in litres sold).
"We're just sitting here working as hard as we can to keep our head above water with all of the adversities that've been thrown our way," said Philip C.Gates Jr., the vice president of Kanawha Groves.
Until hurricane season ends Nov. 30 and the potential for a winter freeze passes next spring, the best prediction anyone can offer about Florida's citrus harvest is an educated guess.
Two well-respected Florida analysts using complicated mathematical formulas and sampling techniques reached two very different conclusions:
- Citrus Consulting International put the orange harvest at 123 million 40-kilogram boxes, which would be the worst since 1988, when a wave of freezes crippled the industry.
- Louis Dreyfus Citrus put the figure at 160 million boxes.
Both estimates are well short of the 220 million-box average Florida produced before the hurricanes whipped through in 2004 and 2005 and more in line with last season's 150 million-box haul in July.
Crop smallerthan usual
Elizabeth Steger, Citrus Consulting's founder, traced the disappointing forecasts to the low numbers of fruit per tree.
"We have several live trees with no fruit," she noted. "It was obvious to me that we had a smaller crop. I believe the last two hurricane seasons impacted the older tree production."
The U.S. Department of Agriculture's official projection, which is based on its citrus tree count, doesn't come out until Oct. 12.
But the tree census, released this month, amounted to more bad news. The USDA determined Florida had 251,460hectares of citrus, a 17 per cent drop from two years earlier.
Failed policy to fight tree disease blamed
A main contributor was a failed public policy that mandated the destruction of all trees within about 580 metresof one testing positive for canker, a disease that causes fruit to blemish and drop prematurely.
Eight million commercial orange trees were destroyed over 10 years before the program was abandoned in January, when officials determined cutting them down couldn't prevent the spread of the bacteria that causes the diseasebecause hurricane winds had already blownthem all over Florida.
Bob Terry, an administrator at the USDA's Florida field office, said the canker push was the single greatest cause of tree loss.
But worsening it, he said, were "land values shooting really, really high and groves being sold for developments."
Better size, sugar content
Growers are trying to remain optimistic. Doug Bournique, executive vice president and general manager of Indian River Citrus League, said the size and sugar content of the fresh oranges grown in his region so far are much better than recent years.
"All of the parameters that you gauge quality by, and appearance, are top drawer this year, really exceptional," he said.
However, Bournique said he knows nothing is certain in the industry.
The season looked promising in 2005 until Hurricane Wilma tore across South Florida at the end of October — a late run for Atlantic storms.
"We were set up for a decent season then, and boom, 70 per cent of the fruit in St. Lucie and 80 per cent in Martin County were on the ground," he said.