OJ pips all other commodities as consumers seek vitamin boost

Consumers who fear getting the coronavirus are looking to strengthen their old-style immune system: by filling up on orange juice.

Frozen concentrated orange juice traded in New York is the best performer of all commodities this year, according to Bloomberg data, up 25% to $ 1,214 a pound since early January. US buyers have rushed to get basic supplies, analysts said, while fears about labor shortages in factories and transportation have also boosted prices.

“There is a lot of orange juice, but it’s a bit like toilet paper – there is no shortage but people are rushing to buy it,” Neil Murray told IHS Markit Agribusiness Intelligence .

Jack Scoville, of Chicago-based Price Futures Group, a commodity broker, said prices had been buoyed by concerns over supply chain problems. “Traders are wondering if workers are there to maintain factories in Florida and Brazil. In addition, there are not enough tankers or containers to ship the product to buyers, ”he said.

Rising prices for orange juice come as the market languishes amid increased production in Brazil, the largest producer and exporter, and in Florida, IHS said. On the demand side, too, consumption has declined in recent years, with buyers switching to water and other low-sugar drinks.

Arabica, the high-quality coffee bean, also rebounded, up 24% from last week, to $ 1.277 a pound in New York. The product had sold at the start of the viral epidemic, due to declining demand in cafes and coffee chains, but analysts said the focus was now on securing supplies in the face of increased logistical risks.

“Everyone in the supply chain is trying to get their hands on the stock,” said Carlos Mera, analyst at Rabobank, noting the high demand from importers and roasters.

Retail demand was also strong. In the UK, for example, consumers have switched from coffees to retailers to fuel their caffeine addiction, buying coffee and coffee beans from stores. In the week before March 14, retail sales increased 30% over the same period last year and 8% over the previous week, according to data from Nielsen.

Wholesale buyers of coffee were frightened by calls from port workers in Brazil, the leading producer and exporter of coffee beans, to close the ports. Although this has not yet materialized, companies and importers will stock up if the flow of coffee dries up, analysts said.

Before the current price volatility, global coffee bean supplies, particularly in Central America, followed several years of low prices. The threat of low levels of coffee stored among exporters and producers had supported spot grain prices, despite the weakness in the futures market.

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