A small grower shares his thoughts on the current market situation.
By Chip Henry
The functionality and integrity of the cash (spot) market for Florida oranges this season has been undermined by the untimely and excessive supplanting of imported juice into Florida processing plant inventories. The resulting price crash has cast a pall on growers selling their fruit on the spot market. Not only has any chance of earning a profit been wiped out, a huge chunk of operating expenses will not be recovered due to the disastrously low prices offered for fruit by processors.
The income that didn’t come to hard-working growers was heisted and claimed by the owners of Florida-based processing plants that buy imported juice and the governments of Brazil and Mexico selling the juice to the plants. According to a revised Florida Processor Statistics Report Summary #31 for the week ending May 2 compiled by the Florida Department of Citrus, the volume of imported frozen concentrated orange juice has outpaced the Florida-grown processed fruit volume by 40 percent. And when you add the fact that the spot market was not quoting offers for fruit for 13 weeks during the October through May season (according to Florida Citrus Mutual Market News Bulletins), it is painfully evident that imports are the culprit bloating the supply side and stifling the need for Florida fruit.
Based on the principle of ceteris paribus (“all things being equal”), when applied in terms of economics, it is clear what the outcome will be if the status quo is maintained. Growers selling on the cash market will see a light at the end of the tunnel, but it will be an oncoming freight train hauling imported orange juice!
U.S. Department of Agriculture juice buy-up contracts are an artificial fix based on contrived demand that in no way reflects a true market rebound. Plus, the product being purchased by the U.S. government contains a significant proportion of imported juice that further dilutes any perceived benefits to the Florida citrus producer.
Subjecting Florida citrus growers to expendability not only puts them out of business but does irreparable harm to their families as well as economically depriving the communities in which they live, employ workers and spend their citrus dollars. How many owners of Florida citrus processing plants or officials of the Brazilian and Mexican governments spend money in your hometown community? You get the idea here. The local, hard-working, patriotic farmer has value beyond the farm.
Respect our contributions while we’re still farming and pay us for them now!
Chip Henry (email@example.com) grows citrus at McGuire Groves in Apopka, Florida.
Read more from Chip Henry on citrus insect control.