The wild summer ride for Florida orange juice continued recently after a pair of reports predicted lower output this year. The output estimates sent the price of juice futures contracts up 4 percent, which followed a late June swoon and July rally. But the longer-term prospects for the citrus industry are more bleak than daily speculative price swings on futures exchanges far from the groves of Polk and other Florida counties.
On the same day as the spike in the price for juice futures — a contract to buy or sell on a given day — an article on the Dow Jones News Wire reported U.S. retail orange juice sales fell to the lowest level in 10 years. That decline tracks a similar drop in Florida citrus acreage over that period, due to diseases, lower tree planting rates, abandoned groves and multiple hurricanes and tropical storms. Between 2002 and 2012, citrus acreage in the state has fallen by one-third from 796,540 acres to 531,493 acres, according to the U.S. Department of Agriculture. Output in Florida has fallen from 244 million 90-pound boxes in 1998 to a projected 133.4 million in 2013, according to the U.S. Department of Agriculture. (Private-sector estimates lowering that estimate to 132 million boxes are what drove the price up on the futures contract.)
The falling citrus acreage has long-term economic ramifications.
In many counties, citrus groves were sold to developers. In Polk County, some groves were sold and many others are on the market, but large-scale development activity has been nonexistent.
We don’t think the development lull will last forever. As coastal property becomes scarce, development inevitably will move toward us here in Central Florida. Another factor will be how the Great Recession impacted retirement plans for northern Baby Boomers Florida has long expected to pack up and head to Florida.
Citrus and sunshine — both featured on Florida license plates — will continue to be key economic drivers for many years. The question recent trends raises is how development blends into the mix and how quickly that happens.