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Monday, 11 Nov. 2013
The beleaguered frozen concentrated orange Juice (FCOJ) market was rocked by the unexpected dip in forecast production from Florida on 8 November 2013. FCOJ futures jumped the most for eight months in the wake of the announcement which can be viewed below. Orange juice for January delivery rose 5.3% to US$1.315 per pound at on ICE Futures US in New York. This jump is seen as a knee jerk reaction to the news.However, the fundamentals of the FCOJ remain. Demand has tanked in the United Sstates of America market. This anticipated drop in production could be just what is needed to bring some balance into th supply/demand equation. It does not seem to be large enough as a decrease to affect the more buoyant not from frozen (NFC) market, but if there is to be pressure, then this is where it may eventuate depending on the ratios that will come forward.Florida All Orange Production Forecast down 6% from Last Season at 125 million Boxes
The 2013-2014 Florida all orange forecast released today by the USDA Agricultural Statistics Board is 125.0 million boxes, a 6 percent decrease from last season's production. If realized, this would be the lowest production since the freeze-affected 1989-1990 season. The total is comprised of 58.0 million boxes of non-Valencia oranges (early, midseason, Navel, and Temple varieties) and 67.0 million boxes of Valencia oranges. The Navel orange forecast is 2.1 million boxes, 4 percent of the non-Valencia total.
The hurricane seasons of 2004-2005 and 2005-2006 have been excluded from the usual 10-year regression analysis and from comparisons of the current season to previous seasons. For those previous 8 seasons, average actual production is 157.5 million boxes. The initial forecast has deviated from final production by an average of 4 percent with 7 seasons above and 1 below, with differences ranging from 1 percent below to 15 percent above.
The estimated number of bearing trees for all oranges is 56.8 million, down 1 percent from the previous season. Trees planted in 2010 and earlier are considered bearing this season. Field work for the latest Commercial Citrus Inventory was completed in July 2013. Attrition rates were applied to the results to determine the number of bearing trees which are used to weight and expand objective count data in the forecast model.
The early months of 2013 brought little precipitation and average temperatures to the citrus growing region. Significant rainfall returned in late spring and slowly eliminated drought conditions by the first week in July. Seasonal temperatures together with above average precipitation continued throughout the summer months and kept the citrus groves drought-free through mid-October. Dry seasonal conditions returned during the final weeks of October as the harvest began. The procedures used in this forecast are the same as used in past seasons. The methodology is described on page 5 of this report. All references to 'average' refer to the average of the previous 8 non-hurricane seasons.
Non Valencia Orange Production Forecast down by 14% on Last Season at 58 million Boxes
The non-Valencia forecast of 58.0 million boxes is 14 percent lower than last season's production. The estimated number of bearing trees (excluding Navels) is 23.7 million, down 1 percent from the previous season. The estimated fruit per tree for early-midseason oranges is 918, a decrease of 11 percent from last season. Projected fruit size is below the minimum, requiring an estimated 284 pieces of fruit to fill a 90-pound box. Projected droppage is near the maximum at 18 percent.
The prorated forecast shows a decrease of 1.4 million boxes in the Southern area compared to last season. The Indian River area shows a decrease of 100 thousand boxes and all other areas show a combined decrease of 7.6 million boxes when compared to 2012-2013.
The Navel forecast of 2.1 million boxes is 5 percent lower than last season's production. The estimated number of bearing trees is 985 thousand, down 2 percent from the previous season. The estimated fruit per tree is 429, an increase of 4 percent from last season. Projected fruit size is near the minimum, requiring an estimated 142 pieces of fruit to fill a 90-pound box. Projected droppage is above average at 19 percent.
Valencia Orange Production Forecast up by 1% on Last Season at 67% million Boxes
The Valencia forecast of 67.0 million boxes is 1 percent higher than last season's production. The estimated number of bearing trees is 32.1 million, down 1 percent from the previous season. The estimated fruit per tree is 614, a decrease of 7 percent from last season. Projected fruit size is below the minimum, requiring an estimated 234 pieces of fruit to fill a 90-pound box. Projected droppage is above average at 18 percent.
The prorated forecast shows a decrease of 1.6 million boxes in the Southern area compared to last season. The Indian River area shows an increase of 900 thousand boxes and all other areas show a combined increase of 1.2 million boxes when compared to 2012-2013.
FCOJ Yield up by 0.8% on Last Season at US$1.60 gallons per box of 42 brix
The projection for frozen concentrated orange juice (FCOJ) is 1.60 gallons per box of 42° Brix concentrate. Last season's final yield for all oranges was 1.587680 gallons per box, as reported by the Florida Department of Citrus. Projections for the components will be published in January. Record yields are 1.597195 gallons per box for the early-midseason category in 2008-2009, and 1.790343 gallons per box for the late oranges (Valencias) in 2007-2008. The record yield for all oranges is 1.672737 gallons per box set in 2007-2008.
Source: Citrus Forecast November 2013, United States Department of Agriculture (USDA), National Agricultural Statistics Service (NASS), Florida Field Office.