OJ Futures Surge On Cold Florida Winter Forecast
The price of orange juice surged Tuesday as balmy weather in Florida failed to quell concern about an expected winter freeze that could damage the state's orange crop.
Frozen orange juice concentrate for January delivery rose 4.95 cents, or 4.2 percent, to finish at $1.22 per pound. Trading was light, making the price more volatile.
Traders have grown more interested in orange juice futures since the government predicted in October that it could be colder than normal from December through February in Florida.Buyers are also interested because futures are about 45 percent less than in January, when they jumped after low levels of fungicide were found in orange juice products. The government said the juice was safe and did not order a recall. The Florida crop is in good condition, and the weather in Brazil, a huge exporter of orange juice products, has helped, analysts say. "It's kind of the best of both worlds because orange juice prices have been beaten down, so you can buy them when they're real cheap, but you can also have the chance of some real upside if you do get that surprise freeze," said Spencer Patton, founder and chief investment officer of Steel Vine Investments LLC. In other trading, the price of oil fell 2.8 percent are Israel and Hamas appeared close to a cease-fire to end Israel's week-long offensive in the Gaza Strip. That could ease concerns about oil supply disruptions from the Middle East. Benchmark oil fell $2.53 to finish at $86.75 per barrel. Heating oil dropped 3.59 cents to $3.0392 per gallon, and gasoline futures fell 4.2 cents to $2.7125 per gallon. Natural gas jumped 11.3 cents, or 3 percent, to $3.832 per 1,000 cubic feet. Gold and other metal prices ended the day lower. In December contracts, gold dropped $10.80 to finish at $1,723.60 per ounce, silver fell 25.9 cents to $32.93 per ounce, copper decreased 1.1 cents to $3.5165 per pound, and palladium dropped $6.95 to $638.35 per ounce. January platinum fell $10.80 to $1,573 per ounce.
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