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Orange Juice Outlook for Selected Countries
| Orange juice production in the major Northern Hemisphere producing countries in 1999/2000 is forecast at 1.1 million metric tons, 65 degrees brix, 12 percent above the previous year’s output. Total U.S. and Spanish production are forecast to increase by 12 and 4 percent, respectively, which will more than offset lower production in Mexico. Most countries are forecast to increase orange juice production as a result of the general rebound in Northern Hemisphere orange production in 1999/2000. U.S. orange juice production is forecast to increase to 987,000 tons, as the larger Florida orange crop has increased fruit availability. Selected country orange juice exports in 1999/2000 are forecast to increase only slightly to 220,000 tons. U.S. exports in 1999/2000 are forecast to approximate the previous year’s shipments, though NFC’s share of exports is expected to continue to gain ground versus FCOJ exports. |
Northern Hemisphere
United States
U.S. orange juice production in 1999/2000 is forecast at 987,000 tons, 12 percent above last season’s output. A higher volume of oranges will be processed in 1999/2000, as a result of a rebound in the orange production in Florida. The Florida frozen concentrate orange juice (FCOJ) yield is forecast at 1.57 gallons (42 degrees brix) per box.
U.S. orange juice exports in 1999/2000 are forecast at 105,000 tons, roughly the same as the past three years. Major U.S. customers are the European Union (EU), Canada, Japan, and Korea. In addition to FCOJ, a key export from the United States is "Not-From-Concentrate" (NFC) juice, single strength (11.8 degree brix), which is a higher quality and higher-priced juice product and is rapidly increasing in importance as an export commodity. Imports of orange juice, mainly FCOJ, in 1999/2000 are forecast at 225,000 tons, down 10 percent from the previous year due to the higher availability of U.S. juice. Processing plants in Florida, several of which are Brazilian owned, are importing Brazilian FCOJ (65 degree brix), which is often mixed with Florida juice or juice from other origins in order to get the optimal mixture and then marketed in the United States or abroad.
Mexico
Mexico’s orange juice production for 1999/2000 is forecast to decline by 3 percent, to 37,000 tons, due to a second straight year of low availability of oranges for processing. Lower domestic orange production and relatively low international FCOJ prices will make it difficult for processors to compete with the fresh market for the smaller orange harvest.
Mexico’s orange juice exports in 1999/2000 are forecast at 33,000 tons, down 11 percent from shipments in 1998/99. The United States is the main market for Mexican FCOJ, though Japan and the European Union are also important customers.
Under NAFTA, Mexico has access to the United States market for 40 million gallons of FCOJ, single strength equivalent (or 28,452 tons, 65 degrees brix) at a duty of 3.93 cents per liter. Beyond the 40 million gallon level, and up to 70 million gallons SSE, the full NAFTA rate for 2000 of 7.862 cents per liter is applied. If snapback price conditions are not in effect, the NAFTA rate would continue to be applied beyond the 70 million gallon level. However, if price conditions are in snapback, the full MFN rate, currently, 7.85 cents per liter for 2000, would be assessed on all imported volumes beyond the 70 million gallon threshold. This basic mechanism will remain in effect during the 15-year phase-in period agreed upon in the NAFTA negotiations, although the quantity trigger level will be increased to 90 million gallons SSE in the year 2003.
Spain
Spain’s orange juice production in 1999/2000 is forecast at 44,000 tons, 4 percent above the revised 1998/99 level. An increase in oranges delivered to processors is expected, due to a larger orange harvest. Oranges used in Spain to produce juice are mainly those that cannot be marketed for fresh consumption. Most orange processing plants in Spain are located in the Valencia region.
Orange juice exports in 1999/2000 are forecast at 54,000 tons, 4 percent above the previous year’s revised shipments. The bulk of Spain’s orange juice exports go to traditional export markets in the European Union, such as France, Germany, and the United Kingdom. Strong competition from the United States, Brazil, Israel, and other key producing Mediterranean countries represent the principal obstacles to the expansion of Spanish citrus juice exports to third countries.
Southern Hemisphere
It is too early to make reliable forecasts for the Southern Hemisphere for 1999/2000 (2000 harvest).
Brazil
The U.S. Agricultural Attache estimates Sao Paulo’s 1999 orange crop (marketed in 1999/2000) at 395 million 40.8 kilo boxes, 15 percent above the previous year’s output. According to Post contacts, the Sao Paulo orange crop is expected to be higher than the 1998 season due to less adverse weather conditions during flowering. See Table 3 for more details.
Brazil’s 1998/99 orange juice production estimate (marketed in 1999/2000) is estimated at 1.3 million tons, a 7 percent increase from the previous year. In 1998/99 (MY 1999/2000), Brazil’s orange juice exports are estimated at 1.2 million tons, 2 percent above the previous year’s shipments. Ending stocks are expected to be higher because the increase in exports are forecast to be less than the increase in production.
(The FAS Attache Report search engine contains reports on the Orange Juice industries for more than 10 countries, including Italy, Argentina, and Australia. For information on production and trade, contact Mark Petry at 202-720-0897. For information on marketing contact Ted Goldammer at 202-720-8498.)
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