After a decade of falling prices, orange juice sales are starting to recover from the lows seen last February, and the prices are continuing to rise today.
According to the most recent Florida Department of Citrus report Florida citrus officials said they hope the most recent orange juice sales figures indicate the carbendazim scare earlier this year has ended and U.S. sales are beginning to pickup after a decade of low prices. Orange juice sales in the Sunshine State edged closer to positive territory than they have since back in March 2011, falling 5.4 percent for the four-week period ending July 7 2012, compared with the same time a year earlier. Although the gains may seem modest, they are a big improvement over the first four months of the year, when orange juice sales dropped between 11.2 percent and 15.5 percent per month.
Although retail orange juice price increases have averaged just 5 percent in the July 7 period, they still hit a record high price of $6.38 per gallon this year and the average retail orange juice price rose between 6 percent and 8 percent for the first seven months of the 2011-12 season beginning last October. Deputy executive director at the Florida Department of Citrus, Bob Norberg said "I would say that sales are starting to recover from the lows seen in February, and even though prices continue to rise, which is good for Florida growers, consumers seem to be less price sensitive than they have been in recent past."
Because strong retail prices are good for growers because they support high farm prices, the Florida Citrus Commission has been hesitant to declare a total trend reversal in domestic orange juice sales, but did issue a report saying the new prices were “A sign we've been looking for. We've got to bottom out before we move up. It's the first time we've had hopeful numbers." The better news was that the U.S. orange juice market is returning to its historical pattern of U.S. orange juice sales falling 1 percent for each 1 percent increase in the average price, and during the first five months of 2012, the sales decline was 4 to 5 percentage points larger than the average price increase.
Some citrus industry observers had thought the FDA’s recent ban of orange juice imports with detectable traces of the illegal fungicide carbendazim in them was a contributing factor, and as a result the orange juice imports to the U.S. from January through May of 2012 declined by 30 percent compared with the same period in 2011. However, the FDA announced in May it had stopped mandatory carbendazim testing for all orange juice imports, but indicated it would still be testing on a selective basis. All things considered, the best news on retail orange juice prices came after the end of the recent 2011-12 Florida citrus harvest that was one of the best seasons for farm prices in the state's history.