Hurricane Ian made landfall in Florida as a Category 4 major hurricane, causing major disruption and concerns for citrus fruits in particular. The destruction in Florida led to significant fruit drop and fruit damage for many citrus growers. Many of the top orange producing districts in Florida are in the central region, where the storm was most impactful. According to market sources, the damage is yet to be quantified, but initial observations indicate that high fruit drop will lead to a reduction in orange production this year.
US orange production has fallen every year consecutively since 2017/18, largely due to the ongoing threat of citrus greening (a citrus plant disease spread by tree lice) in Florida, which is impacting yields. In the October 2022 USDA citrus forecast, 2022-2023 Florida orange production was forecast at 28.0 million boxes, down 32% from last season’s final production. This figure is based on a survey that happened prior to the hurricane and is, therefore, likely to be adjusted downwards in future forecasts. Additional fruit loss resulting from the hurricane will, therefore, cause a further drop in production estimates, which is likely to drive US orange prices upwards throughout the 2022/23 season. A significant proportion of the Florida orange crop is earmarked for juice production. Accordingly, lower volumes of oranges are expected to be available for processing and at a higher cost, thus also acting as a bullish driver for the US orange juice market.
