The price of orange juice futures contracts hit a 34-year high on Tuesday after the main US food safety regulator said it would block imports containing a fungicide commonly used in Brazil, the leading producer of the citrus fruit.

The Food and Drug Administration’s announcement sent traders scrambling to prepare for the possibility of lower inventories in the middle of the US winter, when the New York futures market is most at risk of a harsh freeze in Florida’s orange groves.

Frozen concentrated orange juice for January delivery rose 9.7 per cent to $2.1275 a pound on the ICE Futures US exchange, the highest since November 1977 and a record nominal closing price. It has risen 25.9 per cent so far this year. The more heavily traded March and May futures gained by the exchange limit of 20 cents.

The rise brought renewed attention to the tiny orange juice market, which, along with pork bellies, briefly entered public consciousness in the 1983 film Trading Places but is today an obscure corner of the futures world, with a notional daily turnover of just $75m.

The contract has languished as consumers turned to other drinks. US consumption of orange juice has fallen by nearly a quarter in the past decade, according to the US Department of Agriculture.

PepsiCo, which owns the Tropicana brand, and Coca-Cola, which sells Minute Maid and Simply juices, account for 62 per cent of the orange juice sold at US supermarkets, according to Bernstein Research.

The futures market price rise could drive retail prices of orange juice higher, said Judith Ganes Chase, a soft commodities consultant, but she added that the market reaction was overdone.

Futures began rallying last week as traders puzzled over the impact of the season’s first freeze in Florida, but the damage to crops was minimal.

On Monday, the FDA said an unnamed juice company had detected low levels of carbendazim, a fungicide banned in US oranges, in its own and competitors’ juice. The fungicide was also found in concentrate from Brazil, the source of about 60 per cent of the world’s orange juice.

“FDA is also sampling import shipments of orange juice and will deny entry to shipments that test positive for carbendazim,” the FDA said. The test results were below levels that raise safety concerns.

“They could ban [all] imports from Brazil. That would take the whole Brazilian crop out of the market. It could be huge,” said Avery Putter, a broker with Pine Point Commodities on the ICE floor.

In response to the sudden price moves, the exchange cancelled a scheduled 27 per cent reduction in the margin deposit needed to trade orange juice and instead almost doubled it.

Christian Lohbauer, head of the Brazilian Association of Citrus Juice Exporters, said it was still unclear whether the US would accept Brazilian orange juice that is currently in the process of being imported. He added that the most likely outcome was that Brazilian producers would have to change the type of fungicide they use for the US orange juice market. “I doubt they will change their minds, so they will ask us to stop using it.”

He said it was unlikely the US would simply ban Brazilian orange juice imports: “After all, the US needs our juice.”

Coca-Cola would not confirm or deny whether it had reported traces of carbendazim to the FDA. The company sources most of its juice oranges from Florida but some come from Brazil, the Atlanta-based company said.

“We are gathering facts so that we can understand the situation, and clearly that includes testing,” it said. “But as the FDA has said, Brazilian orange juice is safe. This is an issue that impacts many in the industry.”

When reached for a comment, a Tropicana spokesperson said: “Tropicana juice is safe and nutritious, and we’re proud to offer high-quality, great-tasting products. As one of the world’s most trusted consumer brands, we take this matter seriously and will follow the FDA’s guidance.”

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