Orange Crisis: Skyrocketing Prices Force Juice Makers to Seek Alternatives

Clear Facts

• A global orange shortage, leading to skyrocketed prices, has orange juice manufacturers contemplating the use of alternative fruits
• Orange prices reached $3.68 per pound in April, a rise of 33% from the previous year, and a staggering 210% increase since January 2021, just before the onset of the inflation crisis
• Factors contributing to this surge include a decline in Florida’s output, disease and extreme weather events in Brazil, which is responsible for approximately 70% of the world’s orange production

As the world grapples with rising orange prices, orange juice manufacturers are contemplating the switch to alternate fruits for producing the popular breakfast beverage.

Global orange prices peaked at $3.68 per pound in April, according to data from the International Monetary Fund. This is a significant leap of 33% from $2.76 per pound last year, and an astonishing 210% surge from January 2021, just before the inflation crisis took hold.

“There are three main factors driving the soaring price of orange juice, and it’s drought, disease, and demand,” stated Ted Jenkin, CEO and co-founder of oXYGen Financial.

The escalation in price is a result of a dwindling output from Florida, the leading U.S. producer. There has also been significant damage due to disease and extreme weather conditions in Brazil, which is accountable for roughly 70% of global production.

In Brazil, orange trees have been afflicted by a disease known as citrus greening. This condition causes trees to yield fruits that are partially green, undersized, distorted, and bitter.

“There is no cure, and trees typically die within a few years of infection.”

Alongside the disease, severe heatwaves and droughts during the critical periods of flowering and early fruit formation have put Brazil in line to record one of its worst orange harvests in over three decades.

The citrus growers’ organization estimates that Brazil is on track to produce only 232.4 million boxes of oranges in the 2024 to 2025 season – marking a significant decline of 25% compared to the previous cycle.

“Should this production forecast hold true, this will be the second-smallest crop since 1988-1989,” the report revealed.

Moreover, Florida has been afflicted by a series of hurricanes as well as the greening disease, which is spread by the Asian citrus psyllid.

“This is a crisis,” said Kees Cools, president of the International Fruit and Vegetable Juice Association (IFU). “We’ve never seen anything like it, even during the big freezes and big hurricanes.”

As a consequence, orange juice prices are also rocketing. The cost of a 12-ounce can of frozen orange juice concentrate surged to $4.25 in April, a 41% increase from one year ago.

Typically, orange juice manufacturers have counteracted long-term shortages by freezing juice stock, which can be preserved and used for up to two years. Nevertheless, even this frozen stock is dwindling due to a three-year shortage build-up.

Cools suggested that manufacturers may have to consider different fruits, such as mandarins, which are more resistant to the greening disease. However, he cautioned that this could be a lengthy process.

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