Orange Juice Prices Sour
Orange juice prices fell this week as better weather across Florida increased hopes for a robust orange crop this year. The Sunshine State produces more than 70 percent of U.S. oranges, making its weather patterns important to orange juice traders. Much-needed rains fell across the state over the last few weeks, and weather has remained warm, reducing fears of a damaging frost this winter.
As traders brushed weather fears aside, they sold their orange juice holdings, dropping prices. In a little over two weeks, prices for frozen concentrated orange juice (FCOJ) collapsed by more than 34 cents per pound, a decline of nearly 25 percent.
Despite the recent sell-off, OJ bulls point out that there are still lingering threats to this year's crop. A citrus disease, known commonly as "greening," threatens to sap long-term orange production. Furthermore, a surprise cold snap during late January or early February could still hit Florida's orange groves, potentially sending prices sky-high. As of midday Friday, FCOJ for delivery in January was $1.11 per pound.
Beans Continue Down
Once again, soybean prices are feeling downward pressure from China, as the Chinese canceled another large order of soybeans (315,000 metric tons). Presumably, the Chinese have been cutting purchases in anticipation of being able to purchase cheaper soybeans from South America. In addition, better weather conditions in South America may yield more crops for major soybean producers Brazil and Argentina than previously expected.
As of midday Friday, prices for soybeans for January delivery were at $13.80 per bushel, down 44 cents (-3.1 percent) during the week.
Gold Gouged By Fed Minutes
Gold prices tumbled on Thursday following the release of Federal Reserve meeting minutes that indicated that fiscal stimulus may end sooner than expected. Low interest rates, driven by Federal Reserve policy, have been one of gold bugs' motivations for buying the precious metal over the past few years, and the potential for higher rates by the end of 2013 caused widespread selling of gold. In just two days, gold fell as much as $60 per ounce (-3.6 percent).
Posting a comment requires free registration:
- If you already have an account, follow this link to login
- Otherwise, follow this link to register