Orange Juice

Over its last 20 sessions OJ has moved 3.34% on a typical day, making it one of the most volatile of the commodities Kinzan tracks (their median is 1.88%).

Today's move is well inside its normal range: −0.1σ, an entirely ordinary session.

It sits in the upper half of its 24-hour range of 140.95–142.35, measured on hourly closes.

Most of the move came in the New York session (13:00–22:00 UTC), which accounted for about 100% of the day's price action.

Over the last 60 sessions OJ has had no strong day-to-day relationship with anything else Kinzan tracks — its closest link is GOOGL at +0.37.

Its last close is at the 45th percentile of its own last 83 sessions, and its 20-day volatility at the 13th.

Market read: Orange Juice is trading near its daily high despite very low volume and minimal price movement.

What it is

The contract on this page prices frozen concentrated orange juice: juice from which most of the water has been removed for shipping and storage, to be reconstituted later. It trades on ICE Futures US, quoted in US cents per pound of orange solids rather than per litre of juice, with 15,000 pounds of solids per contract. Deliverable juice can come from the United States, Brazil and a few other approved origins. It is a small, specialised market, best known to many from the climax of the film Trading Places, and thin trading makes it one of the most volatile agricultural contracts.

What drives it

Two regions dominate supply. Brazil, centred on São Paulo state, is by far the largest producer and exporter of orange juice. Florida, once its rival, has seen output collapse over the past two decades, mainly because of citrus greening, an incurable bacterial disease spread by a small insect. Hurricanes, which threaten Florida from June to November, and occasional winter freezes add to the risk, and a single storm can strip fruit from trees across a growing area. Brazilian groves have also suffered from greening and drought. Because new trees take years to bear fruit, shortfalls tend to persist rather than correct within a season. Demand in major consumer markets has been drifting lower as breakfast habits change and higher prices push buyers towards other drinks. Official crop forecasts for Florida and industry estimates for the São Paulo citrus belt are followed closely.

How it trades through the day

Orange juice trades only during US daytime hours, so almost all of its activity falls in the New York block (13:00–22:00 UTC), with nothing in the Asia block (22:00–07:00 UTC) and little or nothing in the London block (07:00–13:00 UTC). Even then volume is light, and a handful of trades can move the price a long way when a storm forecast or a crop estimate lands.

What it tends to move with

Orange juice has very little systematic connection with other instruments on this board. It shares exposure to Brazil’s currency with sugar and coffee, so a sharp move in the real can occasionally nudge all three, but its own drivers — disease, storms and the size of a few harvests — tend to overwhelm anything common.