OJ prices continue to rise

Related tags Orange juice Percentage point

The effects of last year's hurricanes are still making themselves
felt in the orange juice industry, where the price of juice is
rising, reports Philippa Nuttall.

The price of pasteurized juice is up 5 percent to $5.46 a gallon, according to AC Nielsen, and the higher average prices have contributed to a decrease in volume by 4.1 percent from last year. Moreover, although the cost of juice made from concentrate has dropped, it is expected to start climbing.

However, there was some good news for OJ producers as retail gallon sales for the first 4-week period since February 2003 surpassed the same period last year with revenues up by 4.2 percent.

The Florida Department of Citrus will be hoping that its national campaign - reminding consumers of the nutrients contained in orange juice - launched last October will have helped boost retail sales.

But as FoodNavigatorUSA.com reported last month, the industry sems set for a difficult time before the situation starts to improve as forecasts for production remain low. The drop rate, at 18 percent for fruit in Florida in March, was above the past ten seasons for the early-midseason fruit. Moreover, concentrate surpluses from the previous year are starting to run dry.

And while the blossom may be on the trees heralding next year's fruit, Jorge Garcia-Pratts, a USDA statistician, said recently that it was too early to tell whether there would be any effect on next year's crop, but thought it unlikely as most of the trees damaged by the storm were older ones and therefore, he suggested would have likely been replaced in any case.

"There are too many variables to take into consideration at present,"​ he said.

North America is by far the biggest global market for juice and nectars, according to industry analysts Canadean, accounting for over 35 percent of sales. Canada's consumption has risen by more than 45 per cent since 1997, giving Canadians the highest per capita consumption in the world.

While the US is the biggest single market in pure volume terms, it is Canada and Germany which lead the pack when it comes to per capita consumption. Orange is particularly popular there, with a share some 18 percentage points higher then the global average.

Total consumption in the US declined slightly in 2002 and is expected to have grown only modestly during 2003.

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