This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Don't Panic, Orange Juice Won't Be Squeezed

NEW YORK (TheStreet) -- The unusually severe cold temperatures experienced by the central and eastern U.S. in recent weeks are expected to have a chilling effect on economic activity for the quarter, so much so that a noticeable slowdown in GDP growth is possible.

The largest industries to take a hit are retailers and restaurants -- when would-be diners and shoppers stay warm at home, so do their dollars.

But while the damage caused by weather-related consumer skittishness is generally reversed as soon as temperatures normalize, one industry is threatened with irrecoverable losses when the cold strikes: citrus producers.

Because many varieties of oranges and lemons are harvested in the winter months in the U.S., an unseasonably cold winter can cause devastating losses for Florida and California citrus farmers, some of which pass down to juice producers, crop insurers and consumers.

We've had two significant freezes this season: a deep December freeze in California's Central Valley, and several freezing days in southern Florida where a large portion of the country's oranges are grown.

Impact on Producers

The largest public companies most directly positioned to suffer the brunt of the bad weather are Limoneira  (LMNR) in the Central Valley and Alico (ALCO) in southern Florida.

In the case of Alico, the worst of the possible damage was likely avoided because temperatures in Florida didn't fall deep below 28 degrees (the temperature at which substantial damage to citrus plants occurs) at the peak of the night-time freeze, and didn't stay there very long. While we aren't particularly bullish on Alico in general, we don't believe the winter weather is a catalyst to sell.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $132.36 2.10%
FB $81.55 -1.00%
GOOG $565.06 0.00%
TSLA $218.42 0.00%
YHOO $44.52 0.00%

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs