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| Horticultural & Tropical Products Division | Return to the H&TP Home Page |
Situation and Outlook for Orange Juice
World orange juice production in selected major producing countries in 2001/02 is estimated at 2.5 million tons (65 degrees brix), an increase of nearly 16 percent from the 2000/01 level. Most of the increase is attributed to a return to more-normal levels of production in Brazil. |
GLOBAL PRODUCTION
World orange juice production is
forecast to stage a recovery from last year’s low level.
Production is estimated at 2.5 million tons (65 degrees brix), an
increase of 378,000 tons from last year. Brazil’s
production in 2001/02 (local marketing year July 2002-June 2003) is forecast at
1.3 million tons, up nearly 30 percent from the 2000/01 level.
U.S. production is also set to increase as a result of the increase in
Florida’s orange crop. Together,
Brazil and the United States comprise over 90 percent of world output for the
selected major producers.
Brazil
Brazil’s production of orange
juice during 2001/02 (marketing year July 2002-July 2003) is estimated at 1.3
million tons (65 degrees brix), up a significant 30 percent from the previous
year due to higher fruit availability from the larger crop. Since Brazil’s fresh crop orange exports are limited
because of disease, any increase in orange supplies goes to either processing
into orange juice or for the domestic fresh market.
The amount of oranges destined for processing in Brazil in 2001/02
(marketing year July 2002-June 2003) is up 3.1 million tons from the previous
year.
United States
U.S. production of orange juice during 2001/02 is estimated at 1.0 million tons, up 4 percent from the previous year. This corresponds to an increase in Florida’s orange crop to a total 9.4 million tons, up 2.7 percent from last year. More than 95 percent of the orange crop in Florida is processed for orange juice.
GLOBAL TRADE
Exports of orange juice from the major producing countries in
2001/02 are forecast at 1.5 million tons (65 degrees brix), up 8 percent over
last year. Exports from Brazil and
the United States are estimated to increase 7 and 38 percent, respectively.
Brazil
With the substantial recovery in
production, Brazil’s exports of orange juice in 2001/02 (marketing year July
2002-June 2003) are forecast at 1.2 million tons.
This represents only a 7-percent increase in exports, which is modest
given the 30 percent increase in production.
However, Brazil, the world’s largest exporter of orange juice, drew
down stocks in order to maintain its exports during 2000/01, lowering total
supplies in the current year. Expectations
are that Brazil will increase stock levels somewhat this year.
Belgium and the Netherlands are the largest markets for Brazil’s
exports of orange juice.
United
States
U.S. exports during 2001/02 are
estimated at 120,000 tons, an increase of 38 percent from the previous year.
U.S. exports of orange juice to date during the current marketing year
(October 2001-April 2002) are running about 71 percent ahead of last year’s
pace. However, this rate of exports
is not expected to continue. Part
of the larger shipments can be attributed to last year’s lower Brazilian
supplies. With the higher Brazilian production and exports, U.S.
shipments should slow. In addition,
much larger shipments of orange juice to the EU so far this marketing year were,
more than likely, partially in anticipation of higher EU import duties for
orange juice in retaliation for U.S. steel duties.
Since those higher duties have not been imposed, exports could slow.
EU
On May 14, 2002, the EU formally sent to the WTO lists of
goods it might target with sanctions in possible retaliation for U.S. dumping
duties on steel. This step was
necessary in order for the EU to have the option to impose the sanctions at a
later date. Although the EU had
stated that the sanctions could have come as early as June 18, 2002, if the
United States did not offer compensation for the steel duties, that did not
happen. Since the United States has
made some exemptions to the steel duties, the EU has decided to hold off on
sanctions at this time, at least until September 30. However, the EU put forth two lists. The first list, which includes dried onions, apples, and
orange juices, would be subject to 100-percent duties. The second longer list will apply if the WTO rules against
the United States on the steel duties and the United States does not
subsequently rescind the tariffs. The
second list includes many additional horticultural products: frozen sweet corn,
other dried vegetables, kidney beans, lentils, shelled walnuts, guavas, mangoes
and mangosteens, grapefruit, grapes, pears and quinces, cherries, prepared sweet
corn, and grapefruit juice. For the
horticultural products on the second list, the additional duties range from
13-15 percent. According to the
documents that the EU submitted, all of the commodities on the first list could
collect an additional $601.9 million in revenue. The second list could generate
an additional $585.5 million.
Japan
Japan’s imports of
orange juice during October-September 2001/02 are estimated at 110,000 tons,
down about 5 percent from the previous year.
Brazil is the largest supplier to Japan, accounting for 82 percent of the
total 116,244 tons of orange juice imported by Japan during October-September
2000/01.
CONSUMPTION AND
MARKETING
United States
U.S. consumption of orange juice in 2001/02 is estimated at 1.04 million tons, down slightly from last year. Even with the higher level of orange juice production, imports are running behind last year’s level and exports have been significantly ahead. Stocks are forecast to be drawn down in order to support even this level of consumption.
On April 4, 2002, the 10th Judicial Circuit Court in Florida ordered the Florida Citrus Commission to propose a remedy in the Equalization Tax case. The court had ruled on March 15 that the equalization tax was unconstitutional because it illegally discriminated against foreign citrus products imported into Florida while it exempted imported juice products from other states, mostly California. Based on the ruling, the court was asked to order the Florida Department of Citrus (FDOC) to refund nearly $10 million in equalization taxes to its clients, the amount that the plaintiffs in the case have paid since filing the lawsuits in late 2000 and early 2001, plus 3 years in back taxes (the period of time limited by Florida tax laws.) Under a 1990 Supreme Court decision, the 10th District Court must give the Florida Citrus Commission the first opportunity to propose a remedy. The court gave the Citrus Commission until July to come up with a remedy. The remedy could include a complete refund to companies that paid the tax, back taxes against the companies' competitors who benefited from the tax exemption, or a remedy involving a combination of a tax refund and back taxes. In the wake of the court's March 15 ruling, the Florida legislature removed the tax exemption for domestic juice, with the new law going into effect July 1, 2002.
Brazil
had also argued that the tax was unconstitutional because it discriminated
against imports versus domestic product. Brazil
asked for consultations under the WTO and such discussions have been held
between Brazilian and U.S. officials. Given
the changes in the law in Florida, it is unknown whether Brazil will move ahead
with a possible WTO action.
Brazil
Brazil’s consumption of processed
orange juice is estimated at only 15,000 tons during 2001/02 (marketing year
July 2002-June 2003), representing only about 1 percent of production.
Brazilian consumers are more likely to fresh squeeze oranges for their
juice needs.
The Attaché Report search engine
contains reports for orange juice for several countries including annuals for
Australia, Brazil, Argentina, and South Africa.
For more information on production and trade, contact Debra A. Pumphrey
at 202-720-8899. Also, please visit
the citrus commodity page: http://www.fas.usda.gov/htp/horticulture/citrus.html
for the latest information. For more information on marketing issues, contact
Sonia Jimenez at 202-720-0898.
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