The fall in orange supply volumes in São Paulo, Brazil, and Florida, United States, has led to an improvement of prices for São Paulo's fruit juice industry this year, according to an analysis published by PwC.
The company predicts the average price of the 40.8 kilo box of processed oranges for the production of juice to reach 9 reals this year; an increase compared to the 7 reals of 2013, although it also notes that this recovery will largely depend on Florida's upcoming production prospects. Even if confirmed, the price will still not manage to cover the production costs of most Brazilian citrus producers.
"If production prospects grow, international [juice] prices must fall, which will have an impact on the Brazilian domestic market and reduce the income prospects for industry and producers," said PwC.
São Paulo and Florida are the world's largest citrus producers. The Brazilian region of Minas Triangle is the supplier of the main Brazilian juice exporters (Cutrale, Citrosuco and Louis Dreyfus Commodities), and is responsible for over 80% of this product's supply in the international market.