DJ ICE FCOJ Review: Firms As Freezing Temps Invade Citrus Belt

Orange juice futures rose slightly Thursday in a largely rangebound session, with light buying interest spurred by forecasts for freezing temperatures to plunge into Florida’s citrus belt Friday morning. Nearby March orange juice rose 105 points, or 0.76%, to settle at $1.3835 on ICE Futures U.S. May juice added 55 points, 0.39%, to end at $1.4165 a pound.

A dry, arctic air mass will settle over west-central and southwestern Florida Thursday night and Friday morning, taking temperatures below the freezing mark in some areas, the National Weather Service said. The NWS has issued a hard freeze warning for the Tampa Bay area, in effect from 4 a.m. to 8 a.m. EST Friday. Long durations of freezing temperatures are expected, which could hurt citrus crops.

Readings below 28 Fahrenheit for four or more hours will damage citrus. Orange juice traders took the forecasts in stride, however, with the market seeing only light buying interest. Instead, traders seem to be biding their time, waiting for the U.S. Agriculture Department’s crop production report on March 11 for price guidance, said Boyd Cruel, senior softs market analyst at Vision Financial Markets in Chicago.

He expects prices to remain rangebound until shortly before the report, when traders begin to jockey for position. Still, news of another arctic air mass hitting Florida will make growers jittery and will likely cause some in the coldest areas of the citrus belt to implement protective measures such as irrigation to keep the crop from harm.

Producers are already growing one of their smallest orange crops in 20 years, due largely to small fruit sizes and freeze damage in January.

Source : FutureSource