Florida freeze unlikely to hurt OJ prices: buyer
Last Updated: Wednesday, January 6, 2010 | 2:57 PM ET
CBC News
Florida farmers are spraying their crops with water to create a protective layer of ice to help protect the fruit during a cold snap. (Chris O'Meara/Associated Press)Florida farmers are working furiously to protect fruit and berry crops in the face of a stubborn cold front, but two Toronto-area fruit buyers say shoppers don't have to worry about price hikes just yet.
"If [the cold] keeps up for two weeks and gets across the whole state of Florida, then you'll notice a difference," said Larry Davidson, vice-president of procurement for North American Produce Buyers.
"When it comes to juice, there's so many different places that processors can get juicing oranges, unless there's a major crop failure, there's enough to make up the difference," he said.
North American Produce Buyers purchases fruit from around the world for distribution in the Toronto area. On Wednesday morning, workers were loading up Toronto-bound tangerines in Florida, and there was nothing wrong with the crop, said Davidson.
Florida is the second largest producer of juicing oranges, behind Brazil. The majority of fresh oranges come from California and Brazil.
Davidson said even if 10 per cent of Florida's crop failed, shoppers would not notice a difference in prices at the grocery store because extra costs would be absorbed by distributors and retailers. Also, most of the large juice companies like Tropicana are working with fixed costs due to contracts that were signed months ago.
If the Florida freeze worsens, shoppers could see orange juice prices rise marginally — by five cents for a carton of juice, said Davidson.
The situation is a little more unpredictable when it comes to strawberries because there aren't as many import alternatives to Florida, said one importer who didn't want to be named, because they were not authorized to speak to the media.
Strawberry prices could be impacted by the cold. Alternatives could be found in California, Australia and New Zealand, but they would be more expensive, said the buyer.
The overall situation is more worrisome for the farmers themselves, who would feel the immediate impact of a crop failure.
Farmers in central and south Florida have been trying to salvage citrus and vegetable crops by spraying them with water to create protective layers of ice and covering them in plastic.
Florida Gov. Charlie Crist signed an executive order Wednesday giving the state's Division of Emergency Management and other agencies the authority to provide farmers with assistance.
The weather situation is not expected to improve. A large pocket of cold arctic air is continuing to move south and may hit the citrus groves this weekend, bringing a potentially damaging freeze to the Rio Grande Valley of southern Texas and Florida, according to Accuweather.com.
With files from The Associated PressShare Tools
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