This is a record rise for one of the most basic consumer products in the world. Orange juice, of which nearly 55 billion liters are drunk each year on the planet, has never cost so much as in this month of February. This jump could be observed on the New York Stock Exchange, where this raw material is listed, in concentrated and frozen form.
Its price rose to nearly 2.44 dollars per pound (about 450 grams) in early February, with an increase of nearly 17% in one week. A trend that is actually a long-term one: the price of orange juice has increased by almost 150%, i.e. a multiplication by almost 2.5, since February 2020. On Friday February 17, it was down to 2 $.28 per pound, holding at levels not seen before.
Orange harvest down 56% in Florida
This historic price increase is due to the very bleak outlook for this agricultural sector, which is leading to a scarcity of supply. The United States, the world’s second largest producer of oranges behind Brazil, is currently experiencing its worst harvest since World War II. In Florida, the main orange-producing region across the Atlantic, the 2022-2023 season should see the harvest drop by almost 56% compared to last year. This is expected to represent no more than 18 million cases of oranges produced, the lowest volume produced in this state for nearly seventy-five years.
These catastrophic results are primarily due to an epidemic that has been ravaging Florida orchards since 2005: Huanglongbing disease, known as the yellow dragon disease. It is caused by a flea of a few millimeters, the psylla. By feeding on tree sap, it transmits a bacterium to it that disrupts the growth of fruits and causes them to drop prematurely. The latter can even go so far as to cause the death of the contaminated tree.
124% price increase in France
A disaster for farmers, who have been alarmed for many years by this epidemic in the United States, but also in Brazil, also very affected. While 95% of Florida oranges are intended for juice production, the impact of this drop in production is colossal on the daily lives of Americans. But also in the rest of the world, while Brazil and the United States alone represent almost 90% of the world production of orange juice.
In France too, the impact of this crisis is being felt on the shelves. The broker eToro thus detailed in July 2022 that the price of orange juice had jumped 124% in almost two years, an increase which should therefore persist.
Alarming weather disasters
Although this endemic presence has been amputating the Florida market for many years, the very violent weather episodes that affected the southeastern United States last year have further aggravated the situation.
First there was Hurricane Ian, which swept through the southeastern United States in late September 2022, one of the strongest in US history. In this state alone, this natural disaster caused more than 100 deaths and between 28 and 47 billion dollars in damage, according to an estimate by the specialized firm CoreLogic. Concerns were then already mounted concerning the agricultural world, and the price of orange juice had also experienced a first flight, which therefore continued. And if that wasn’t enough, Hurricane Nicole then followed in early November, once again sweeping through Florida, its people and its farms. What lead to these historically low harvests.