Global prices of orange juice set to remain higher for longer: Rabobank

Global prices of orange juice are set to remain high in the coming months on the back of a tight world supply, with smaller-than-expected production and low inventories. However, the decline of demand for orange juice is expected to accelerate in 2023, according to a new Rabobank report released on Thursday, as a result of high prices. Rabobank said weaker consumer demand would also play a part in the downturn “which will, in part, allow the market to find an equilibrium at high levels”. “Prices will probably remain high, at least until forecasts for the 2023/24 Brazil harvest provide more clarity on supply relief,” it said. Rabobank associate analyst Pia Piggott said prices for orange juice in Australia have been subject to inflation. She said the recent quarterly Australian consumer price index found the non-alcoholic beverages category, which include orange juice, had risen 10.5 per cent in the year to December 2022. Ms Piggott added local price increases in orange juice were likely the result of a combination of global market factors and conditions in Australia which had affected local production. “The challenging weather conditions that growers have encountered here in the past year, with flood damage in a number of areas, would also have impacted production and be feeding into higher prices, despite increases in navel orange rejects being channelled from eating to juicing,” she said.