Orange juice futures dropped sharply lower Tuesday for the second straight session, with the contract threatening to erase two weeks of gains.
Frozen concentrated orange juice for September fell 2.7% to $1.318 a pound on the ICE Futures U.S. exchange.
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"Brazil crops remain in mostly good condition, and production estimates are climbing after recent rains," said Jack Scoville, at Price Futures Group in Chicago.
Brazil, the world's largest grower, has stepped up production. Brazilian fresh orange production is forecast at 471 million boxes, up from 352 million in 2016-17 and the highest total since 2012-13.
The boost in supplies from Brazil, combined with a dramatic drop in production in Florida, has made hurricane season less relevant to traders in the market who typically place long bets this time of year based on how a hurricane could impact production in Florida.
Elizabeth Steger, a closely watched independent forecaster, has estimated Florida could produce 75.5 million boxes of oranges in the year beginning Oct. 1. That would be a 10% increase from the U.S. Department of Agriculture's 2016-17 estimate of 68.7 million boxes, which was the lowest output since 1964.
Futures began dropping sharply Monday based on improved weather in Brazil, combined with a new report from Nielsen showing a continued drop in the consumption of orange juice.
Sao Paulo has seen a big increase in rainfall over the past week or so, according to WeatherBELL Analytics, though long-term deficits persist.
On Monday, Nielsen reported orange juice consumption has continued to fall, with sales of orange juice in gallons down 8.9% on the year for the four weeks ended Aug. 5. That brings the season-to-date drop to 7.5%.
In other markets, raw sugar for October lost 0.7% to 13.43 cents a pound, cocoa for December was up 0.1% at $1,893 a ton, arabica coffee for December fell 0.2% to $1.2995 a pound, and December cotton was up 0.4% at 67.81 cents a pound.
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(END) Dow Jones Newswires
August 22, 2017 11:56 ET (15:56 GMT)